When using the NPV method, the interest rate used to discount cash flows should not be thought of as the:
A) hurdle rate.
B) internal rate of return.
C) minimum required rate of return.
D) discount rate.
B
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Parnell, Inc has 5,000 shares of $5 par, 3% cumulative preferred stock outstanding and 25,000 shares of $2 par common stock outstanding. No dividends have been paid for the past two years. If the company wishes to distribute $2 per share to the common stockholders, what is the total amount of dividends that must be paid in the current year?
A) $52,250 B) $50,750 C) $50,000 D) $2,250
Queue discipline refers to the willingness of customers to wait in line for service
Indicate whether this statement is true or false.
Seattle Inc. identifies an investment opportunity, which will yield cash flows of $30,000 per year in Years 1 through 4, $35,000 per year in Years 5 through 9, and $40,000 in Year 10. The initial cash outflow is $150,000, and the firm's required rate of return is 10 percent. Assume cash flows occur evenly during the year, 1/365th each day. What is the payback period for this investment? (Round off the answer to two decimal places.)?
A. ?5.23 years B. ?4.86 years C. ?4.00 years D. ?6.12 years E. ?4.35 years
Transactions in common stock occur in the money market, due to the large amount of money
involved in such transactions. Indicate whether the statement is true or false