4.If the terminal balance of a 5-year project at 10% s0 then which one below is true?A. The IRR of the project is less than 10%B. The future worth of the project is greater than 0C. Discounted payback perlod is 5 yearsOD. The present worth of the project is less than 05 In an incremental IRR analysis, which analysis period should be used to compare 2 mutually altemative projects with 3 and4 years of useful lives? (Assume an indefinite analynis perlod and that the projects are repeatable)O A. B yearsO B. 12 yearsOC. 4 yearsD. 3 years

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If the terminal balance of a 5-year project at 10% is 0, then which one below is true?

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter12: Capital Budgeting: Decision Criteria

Section: Chapter Questions

Problem 11MC: In an unrelated analysis, you have the opportunity to choose between the following two mutually...

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Concept explainers

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.

Question

4.
If the terminal balance of a 5-year project at 10% s0 then which one below is true?
A. The IRR of the project is less than 10%
B. The future worth of the project is greater than 0
C. Discounted payback perlod is 5 years
OD. The present worth of the project is less than 0
5 In an incremental IRR analysis, which analysis period should be used to compare 2 mutually altemative projects with 3 and
4 years of useful lives? (Assume an indefinite analynis perlod and that the projects are repeatable)
O A. B years
O B. 12 years
OC. 4 years
D. 3 years

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