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Question 1 (1 point)
Vance incorporated is considering investing in a project with the following expected cash flows: -124, 89, 37, 27. If Vance’s expected cost of capital is 0.10, what is the expected NPV of the project?
Your Answer:
Question 1 options:
| Answer |
A company invests -$100k in a new project and expects the following cash flows: Year 1 $50k, Year 2 $30k, year 3 $40k. What is the company’s expected IRR?
Question 2 options:
| 10.18% | |
| 9.34% | |
| 11.15% | |
| 6.17% |
Question 3 (1 point)
Heinlein Inc is considering investing in a project with a cost of $100k. If the project is expected to produce cash flows of $50k in year 1, $134k in year 2, and $208k in year 3, what is the payback period.
Your Answer:
Question 3 options:
| Answer |
Question 4 (1 point)
Vance LLC is considering investing in the following projects. Vance’s WACC is 9.5%. Which of the following projects should Vance accept? More than one answer is possible.
Question 4 options:
| A. IRR 11% | |
| B. IRR 9% | |
| C. IRR 10% | |
| D. IRR 8% |
Question 5 (1 point)
Heinlein Inc is considering investing in a project with a cost of $100k. The project is expected to produce cash flows of $50 in year 1, 85 in year 2, and 235 in year 3. If the discount rate is 0.10 what is the discounted payback period.
Your Answer:
Question 5 options:
| Answer |
Question 6 (1 point)
Which of the following is correct?
Question 6 options:
| The MIRR and the IRR methods always give the same result. | |
| The NPV and the IRR methods always give the same result. | |
| The NPV and the MIRR methods always give the same result. | |
| The IRR and the MIRR methods always give the same result. |
