Which of these statements about internal rate of return analysis is BEST?
A) If the IRR is less than the company's required rate of return, the project is worth funding.
B) Projects having lower IRR are generally superior to those having higher IRR.
C) IRR and NPV calculations always make the same investment recommendations.
D) If net outflows follow a period of net inflows, IRR may give conflicting results.
D
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Cash and all other assets expected to be converted into cash or consumed within one year or the normal operating cycle of the business, whichever is longer, are called ____________________
Fill in the blank(s) with correct word
If a company uses the allowance method of accounting for bad debts, which one of the following statements is true?
a. It will report accounts receivable in the balance sheet at their net realizable value b. It will record bad debts only when an account is determined to be uncollectible. c. It will reduce the accounts receivable at the end of the accounting period for estimated uncollectible accounts. d. It violates the matching principle.
Unequal (disparate) treatment is based on an intention to discriminate.
Answer the following statement true (T) or false (F)
Schalheim Sisters Inc. has always paid out all of its earnings as dividends, hence the firm has no retained earnings. This same situation is expected to persist in the future. The company uses the CAPM to calculate its cost of equity, its target capital structure consists of common stock, preferred stock, and debt. Which of the following events would REDUCE its WACC?
A. The market risk premium declines. B. The flotation costs associated with issuing new common stock increase. C. The company's beta increases. D. Expected inflation increases. E. The flotation costs associated with issuing preferred stock increase.