Question 2 (10 points) The Payback Method in capital budgeting ignores: O a None of the above. Ob The expected future cash flows of the firm. OC The initial outlay of the firm. Od The rate of time preference of expected future cash flows.Question 1 (10 points) At a crossover rate of return , two or more streams of Net Present Values are : O a Discontinuous Ob Flows with equal Internal Rates of Return O c Equalized O d Flows with negative Internal Rates of ReturnQuestion 6 (10 points) The W.A.C.C. is a : a Non-stochastic discount rate under all circumstances b Risk-adjusted discount rate under all circumstances C Composite opportunity cost metric Simple opportunity cost metricQuestion 5 (10 points) Consider the following set of cash flows for a new project of Bombay Feature Films Ltd: Year 0 ($100,000)-Project Outlay (The bracket indicates a negative figure) Year 1 Year 2 Year 3 Year 4 Year 5 $ 18,000 $ 18,000 $18,000 $18,000 $ 18,000 Assume that cash flows are reinvested at the rate of 10%, compounded annually. Calculate the Modified Internal Rate of Return (MIRR) on this project. You may refer to the video on Schoology to fully grasp the technique of calculating the MIRR. (Note that n=5) O a 15.98% Ob 18% 18.96% d 19.2%Question 4 (10 points) The M.I.R.R. is based on Oa Cash flows being reinvested at the WACC or a comparable rate. Ob Cash flows being reinvested at the YTM on treasury bonds. O c Cash flows being reinvested at a rate always different from WACC O d Cash flows being reinvested at the IRR.Question 3 (10 points) Watch the video 'Problems with the IRR' (Week 5) carefully. The speaker emphasizes that: Oa Multiple IRRs are never obtained by solving a polynomial function involving cash flows and the discount rate (opportunity cost of capital). Ob None of the above. O c When projects are independent and cash flows are regular, the IRR and NPV criteria are NOT contradictory. Od The IRR and NPV criteria are NOT contradictory when projects are mutually exclusive