Question: All projects (A to G) are 7-year projects. NPV = Net present value. IRR = internal rate of return. MIRR = modified internal rate of

All projects (A to G) are 7-year projects. NPV = Net present value. IRR = internal rate of return. MIRR = modified internal rate of return. PI = profitability index.

Criteria:

Project_A

Project_B

Project_C

Project_D

Project_E

Project_F

Project_G

NPV=

$137,083

$31,290

$6,016

$7,647

($584)

$12,521

$9,214

IRR=

31.80%

48.34%

12.03%

11.30%

9.94%

26.79%

37.87%

MIRR=

18.52%

23.52%

10.62%

10.59%

9.97%

23.53%

20.76%

PI=

1.69

2.25

1.040

1.038

0.999

2.25

1.92

The discounting rate (r) is 10%.

Which of the following 10 statements are false/incorrect (there are several, select all that apply). Consider each statement on its own separate from the others listed:

Question 17 options:

If all projects are mutually exclusive, under the NPV rule only project A should be taken

If projects A, B and C are mutually exclusive (all others are independent), under the PI rule projects B, D, F and G should be undertaken

If projects A & B are mutually exclusive, projects C and D are also mutually exclusive and projects F and G are also mutually exclusive (all others are independent), under the IRR rule projects B, C, and G should be undertaken

If all projects are independent, under the PI rule, all projects should be taken

If all projects are mutually exclusive, under the NPV rule projects A, B, C, D, F and G should be taken

If all projects are independent, under the NPV rule, projects A, B, C, D, F, and G should be taken

If projects A, B and C are mutually exclusive, projects C and D are also mutually exclusive and (all others are independent), under the NPV rule projects A, D, and F should be undertaken

If projects A & B are mutually exclusive, projects C and D are also mutually exclusive and projects F and G are also mutually exclusive (all others are independent), under the MIRR rule projects B, C, and F should be undertaken

If all projects are mutually exclusive, under the IRR rule only project B should be taken

If only projects E and F are mutually exclusive, under the NPV rule only project A should be taken

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 Finance Questions!

Q:

rojects ( A to G ) are 7 - year projects. NPV = Net present value. IRR = internal rate turn. MIRR = modified internal rate of return. ? P I = profitability index. discounting rate ( r ) is 1 0 % . ch...

Q:

All projects (A to G ) are 7-year projects. NPV = Net present value. IRR = internal rate of return. MIRR = modified internal rate of return. PI= profitability index. The discounting rate (r) is 10%....

Q:

All projects (A to G ) are 7-year projects. NPV = Net present value. IRR = internal rate of return. MIRR = modified internal rate of return. PI= profitability index. The cost of capital ( r ) is 10%...

Q:

All projects (A to G) are 7-year projects. NPV = Net present value. IRR = internal rate of return. MIRR = modified internal rate of return. PI = profitability index. Criteria: Project_A Project_B...

Q:

All projects (A to G) are 7-year projects. NPV = Net present value. IRR = internal rate of return. MIRR = modified internal rate of return. PI = profitability index. Criteria: Project_A Project_B...

Q:

All projects (A to G) are 7-year projects. NPV = Net present value. IRR = internal rate modified internal rate of return. Pl= profitability index. of return. MIRR NPV= IRR= MIRR= Pl= Project A $4,711...

Q:

Question 15 (6 points) Saved All projects (A to G) are 7-year projects. NPV - Net present value IRR - internal rate of return. MIRR modified internal rate of return. Pl - profitability index....

Q:

Golden Corp. is a young start-up company and therefore is not paying any dividends on the stock over the next 6 years. However, the following year, the company will start paying a dividend of $23 per...

Q:

All projects (A to G) are 7-year projects. NPV = Net present value. IRR = internal rate of return. MIRR = modified internal rate of return. PI = profitability index. Criteria Project_A Project_B...

Q:

All projects (A to G) are 7-year projects. NPV = Net present value. IRR = internal rate of return. MIRR = modified internal rate of return. PI = profitability index. Criteria Project_A Project_B...

Q:

Give an example of a strategic objective and an operational objective from an organization you work for or have worked for.

Q:

Two companies with different economic-value-added (EVA) profiles are Barton Oil Pipeline Incorporated and Crompton Bank Limited. Adapted versions of the two companies financial statements are...

Q:

What factors affect the level of borrowing in an economy?

Q:

I'm having trouble with this probability question: The students in an outer suburban coaching college have just sat for a very difficult test. There is a total of 5 questions. It is a multiple-choice...

Q:

The Reconstruction and Development Programme (RDP) in part tries to meet this need and has a large commitment to educational provision and people development.

Q:

Trade unions and employer associations. These act as pressure groups and can influence employment relations depending on their relative strengths.

Q:

Approximately 11,300 affirmative action posts have been allocated in the public sector since April 1994 (Horwitz et al., 1996).