Consider the following projects cash flows:End of Year (n)Project AProject BProject CProject D-$1,000-$3,000$2,000- $4,0001$200$2,000-$600-$1,000$500$2,000- $600$6,000273$600-$1,500-$6004$400$2,000-$600$2,000Which of the following statements is correct ?Select one:a. Project A is the only simple investmentb. Project A and D are the only projects that will have a unique positiverate of returnc. Project B is the only non simple investmentd. None of the above

given, year A B C D 0 -1000 -3000 2000 -4000 1 200 2000 -600 -1000 2 500 2000 -600 6000…

Consider the following projects cash flows: End of Year (n) Project A Project B Project C Project D -$1,000 - $3,000 $2,000 -$4,000 1 $200 $2,000 -$600 -$1,000 $500 $2,000 -$600 $6,000 3 $600 -$1,500 -$600 4 $400 $2,000 -$600 $2,000 Which of the following statements is correct ?

Consider the following projects cash flows: End of Year (n) Project A Project B Project C Project D -$1,000 - $3,000 $2,000 -$4,000 1 $200 $2,000 -$600 -$1,000 $500 $2,000 -$600 $6,000 3 $600 -$1,500 -$600 4 $400 $2,000 -$600 $2,000 Which of the following statements is correct ?

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Concept explainers

Present Value

Present value (PV) is defined as the current or present value of all future sums of cash flow or money at a specified rate of return. This rate of return is known as the discounted rate, which is essentially the interest rate, discounted over some time. The expected cash flows are discounted at a discount rate to compute the present value. The higher the discount rate, the higher the future value (FV), but the lower the present value.

Question

Consider the following projects cash flows:
End of Year (n)
Project A
Project B
Project C
Project D
-$1,000
-$3,000
$2,000
- $4,000
1
$200
$2,000
-$600
-$1,000
$500
$2,000
- $600
$6,000
27
3
$600
-$1,500
-$600
4
$400
$2,000
-$600
$2,000
Which of the following statements is correct ?
Select one:
a. Project A is the only simple investment
b. Project A and D are the only projects that will have a unique positive
rate of return
c. Project B is the only non simple investment
d. None of the above

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