estion 1 Cost of capital The following table presents information on a potential project currently being evaluated by XYZ. Which assertion about statement 1 and statement 2 is true? Expected cash flows (number of years from today) 0 1 2 3 4 -$77,000.00 $40,000.00 $25,000.00 $31,000.00 $7,000.00 11.06% Statement 1: XYZ would accept the project based on the project's net present value and the NPV rule. Statement 2: XYZ would accept the project based on the project's payback period and the payback rule if the payback threshold is 2.80 years O Statement 1 is true and statement 2 is true O Statement 1 is false and statement 2 is true O Statement 1 is false and statement 2 is false O Statement 1 is true and statement 2 is false
estion 1 Cost of capital The following table presents information on a potential project currently being evaluated by XYZ. Which assertion about statement 1 and statement 2 is true? Expected cash flows (number of years from today) 0 1 2 3 4 -$77,000.00 $40,000.00 $25,000.00 $31,000.00 $7,000.00 11.06% Statement 1: XYZ would accept the project based on the project's net present value and the NPV rule. Statement 2: XYZ would accept the project based on the project's payback period and the payback rule if the payback threshold is 2.80 years O Statement 1 is true and statement 2 is true O Statement 1 is false and statement 2 is true O Statement 1 is false and statement 2 is false O Statement 1 is true and statement 2 is false
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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estion 1
Cost of capital
The following table presents information on a potential project currently being evaluated by XYZ. Which assertion about statement 1 and statement 2 is true?
Expected cash flows (number of years from today)
1
2
3
4
0
-$77,000.00 $40,000.00 $25,000.00 $31,000.00 $7,000.00
11.06%
Statement 1: XYZ would accept the project based on the project's net present value and the NPV rule.
Statement 2: XYZ would accept the project based on the project's payback period and the payback rule if the payback threshold is 2.80 years
O Statement 1 is true and statement 2 is true
O Statement 1 is false and statement 2 is true
O Statement 1 is false and statement 2 is false
O Statement 1 is true and statement 2 is false
onse.
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