A project manager is using the net present value method to make the final decision on which project to undertake. The company has a 12% required rate of return and expects a 3% rate of inflation for the following four years
What is the NPV of a project that has cash flows as shown in the table?
Year Cash Flow
0 -$250,000
1 $50,000
2 $60,000
3 $70,000
4 $80,000
A) -$9,762
B) -$56,859
C) -$69,387
D) -$98,780
C
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The accrual basis of accounting is often contrasted with the cash basis of accounting. Which of the following is/are true of the cash basis of accounting?
a. The cash basis is not subject to manipulation. b. Most larger companies use the cash basis of accounting. c. The cash basis of accounting provides a strong basis to determine the total assets of the company. d. The cash basis provides an inferior picture of operating performance. e. All of the above are true.
The decision variables for the knapsack problem are defined as the number of items to be included in the knapsack from each of n potential items
a. True b. False
Ethan, the president of Financial Investments, Inc. (FII), and Gina, FII's accountant, are charged with a crime, after the police search FII's offices. Under the exclusionary rule
A. certain FII records are excluded from subpoena by the government. B. certain parties to a criminal action may be excluded from a trial. C. illegally obtained evidence must be excluded from a trial. D. persons who have biases that would prevent them from fairly deciding the case may be excluded from the jury.
George is considering an investment in Parson Inc. and has gathered the following information. What is the expected return for a share of the firm's stock?
State of the Economy Probability of the State Conditional Expected Return Parson Inc. Recession .25 -20% Steady .60 10% Boom .15 35% A) 5.00% B) 6.25% C) 8.33% D) 10.00%