Question: True or False (with explaining reason) 1. Calculating modified ROR must use net cash flows (NCF). 2. Breakeven occurs when the incremental ROR is 0%.

True or False (with explaining reason)

1. Calculating modified ROR must use net cash flows (NCF).

2. Breakeven occurs when the incremental ROR is 0%.

3. Cumulative cash flow sign test can be used to identify cash flows with two positive roots.

4. MARR is usually set to be greater than WACC (weighted average cost of capital).

5. Incremental ROR is the ROR that makes the AW of the incremental cash flow equals zero (AW = 0).

6. When calculating MIRR, if the net cash flow at t=0 is positive, its FW is used in the calculation for MIRR.

7. Breakeven occurs when the ROR of two cash flows is the same.

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