Question: After calculating WACC for determining the required rate of return a corporation must achieve on a capital project, an additional percentage maybe add to take

After calculating WACC for determining the required rate of return a corporation must achieve on a capital project, an additional percentage maybe add to take into consideration:

A. How large the project is.

B. Additional risks the project may bring to the corporation above what the normal acceptable risk is.

C. The interest rate is in the bond market.

D. How long will it take to complete the project.

Present value analysis when used in conjunction with capital projects:

A. It is used to determine the present value of future cash flows.

B. It is not taken into consideration because it is not a relevant cost.

C. Is the future value of cash flow.

D. None of the above.

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!

After calculating WACC for determining the required rate of return a corporation must achieve on a capital project, an additional percentage maybe add to take into consideration: A. How large the...

. When evaluating if a company should accept a new contract to produce more product it should: A . Evaluate all possible fixed cost of accepting the contract. B . Evaluate the propose contract using...

1 0 . After calculating WACC for determining the required rate of return a corporation must achieve on a capital project, an addition percentage may be added to take into consideration: A . How large...

Hi Ruchi, I need help with the attached assignment. It's due in about a week. Thanks 1) The paper should be written in APA style Research Paper format. This is the link that explains the research...

1) A project has a net present value of zero. Given this information: A) the project has a zero percent rate of return. B) the project requires no initial cash investment. C) the project has no cash...

The excel homework assignment below has five tabs that cover five different topics: Net Present Value Analysis, Capital Budgeting and Cost of Capital, Working Capital, Management, Financial Ratio...

Case study The Boeing 7E7 Financial Forecast and Analysis Exhibit 8 contains a 20-year forecast of free cash flows from the Boeing 7E7 project consistent with public information released by Boeing,...

I have some questions I would like help with. They are from my Finance 101 class. Can someone please help me? Q1. Jiffy Co. expects to pay a dividend of $3.00 per share in one year. The current price...

Hi everyone. Can someone please help me to help me to answer the questions below from my finance 101 midterm exam? Q1. Jiffy Co. expects to pay a dividend of $3.00 per share in one year. The current...

Please explain this math to me. I'd appreciate help with the answer: EAC=138100/(1-1/(1+.13797)?10)/ .13797 and EAC=115000/(1-1/(1+.13797)?7)/ .13797 thank you! Instructions 1. Save this MS Word...

West Pacific (WP) is a financial institution incorporated in 1997 and traded on the Toronto Stock Exchange. Its performance has been exceptional since the original issue. Your firm of chartered...

The following data relates to the office air conditioning plant having maximum seating capacity of 25 occupants. Outside design conditions: 34C DBT, 28C WBT Inside design conditions: 24C DBT, 50% WBT...

Nasalcorp just paid a dividend of $ 3 . 2 0 per share on its stock. The dividends are expected to grow at a constant rate of 4 percent per year indefinitely. If investors require a return of 1 0 . 5...

Your client has just purchased an older industrial manufacturing facility. The client has asked your advice on whether or not products manufactured at the facility, material stored on site, material...

4. How do you feel about airlines mining your in-flight data? Is this any different from companies mining your credit card purchases or Web surfing? With the amount of data available to companies...

1. Describe the kinds of data being analyzed by the companies in this case. With the amount of data available to companies doubling every year, new sources of data, and innovations in data...

2. How is this fine-grained data analysis improving operations and decision making in the companies described in this case? What business strategies are being supported? With the amount of data...