The internal rate of return (IRR) can best be described as: A. the discount rate at which a set of cash flows have a zero net present value B. the discount rate at which a set of cash flows have a positive net present value c. the rate which the business has to pay to raise finance for an investment D. the return required by the managers of the business

The internal rate of return (IRR) can best be described as: A. the discount rate at which a set of cash flows have a zero net present value B. the discount rate at which a set of cash flows have a positive net present value c. the rate which the business has to pay to raise finance for an investment D. the return required by the managers of the business

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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Similar questions

For Discounted Cash Flows to be useful, individual investors and companies must estimate a discount rate and cash flows correctly. Select one: a. True a. False
Select all that is true about the role of financial managers and the types of financial decisions they make. a. Capital Budgeting function involves planning and determining the firm’s short term investments. b. Determining the appropriate level of inventory is a working capital management function. c. The duties of the financial manager includes determining the capital structure and which projects the firm should undertake. d. Capital structure describes the mix of short-term liabilities a firm uses to finance its short-term assets. e. The optimal financial management strategy of a financial manager is to reduce the overall risk level of the firm. f. Size and timing of cash flows is unimportant in a capital budgeting decision.
What should a firm’s goal be regarding the cash conversion cycle? Explain
1. Leverage involves using fixed costs to magnify the potential return to a firm. Explain the hedging (maturity matching) approach to financing 2. Illustrate the relationship between profitability, liquidity, and risk in the management of working capital.
with the help of the statement of income attached please answer the below: explain the trend in the net borrowing (proceeds from borrowing less payments of short- and long-term debt) of the firm? explain the trend in working capital accounts? Critically evaluate the financial strength of each of the companie based on the evidence presented in the Statement of Cash Flow.
What are some tools that companies have to manage their (net operating) working capital? Provide examples of inventory and receivables management techniques. What is the Cash Conversion Cycle and why is this a useful metric? Are there risks if this is too low?
Which of the following statements is FALSE?i. Using the payback rule, you can calculate how much profits are earned over the investment period.ii. The IRR is sensitive to the timing of the cash flows.iii. Shareholders have the first claim on the cash flows of the company.
The primary goal of financial management is Select one: a. Increasing the owners wealth b. Reducing risk c. None of these d. Increasing profit
The ratio sales to working capital is a measure ofa. Collectability.b. Operational leverage.c. Liquidity.d. Financial Leverage
Which of the following would increase cash flow for a firm? a. A purchase of fixed assets b. Cash sales c. Purchase of markatable securities d. Credit sales
Which is easier to calculate Multiple Choice A firm's Net Income A firm's Cash Flow
Answer quickly please The _________ is the internal rate of return a firm must earn on its investment in order to maintain the market value of its stock. a. IRR b. net profit margin c. Cost of Capital d. gross profit margin

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