what is apr? do we use APR or EAR when we are calculating the present value of investment? is APR and EAR ever equal? if so, when?

Q: Should the economic engineers make capital-expenditure decisions based on a prediction about the…

A: The question is based on the concept of capital expenditure decision making, which is investment of…

Q: Write the various applications that call for annual-worth analysis techniques?

A: Annual worth analysis is the analysis which is done by the managers before taking capital budgeting…

Q: Why is it necessary to determine how long you can expect to reap benefit from the investment?

A: Individuals as well as firms often make investment and specify the time limit for which this…

Q: If the net present value of a proposed investment is positive

A: Net present value method (NPV): Net present value method is the method which is used to compare the…

Q: Another name for the expected value of an investment would be: a. The mean value b. The risk-free…

A: The expected value (EV) is an anticipated value for investment at some point in the future. In…

Q: How can we aggregate the risk over the project life in terms of net present value?

A: It is an incorporation of the risk level of the project over the life of the in terms of NPV by way…

Q: Which of the following decision criteria is the easiest to use and very popular among investors?…

A: The capital budgeting process uses different methods to analyze the projects. Each method has…

Q: What are some possible financial decisions in which using the Present Value (PV) formula might be…

A: The present value (PV) is the current value provided a defined rate of return of a future amount of…

Q: True or false. to apply the rate of return analysis correctly, we need to classify an investment i…

A: In the given question we need to answer whether the given statement is True or False.

Q: What are the best short-term and long-term investment strategies going forward into the future?

A: Short term investment strategy – Those investment that are usually traded for upto a span of 3 years…

Q: Suppose you know that an investment will earna positive return in the future. Why is it important to…

A: The investment may provide a positive return in the future, but the worth of receiving it in future…

Q: The objective function of an investor in a CAPM world is to what (mathematically) [what are your…

A: The Capital Asset Pricing Model (CAPM), which takes regular research and testing into account, is a…

Q: How do you turn an income statement int a forecasted return? And how is it helpful?

A: Return means earn additional on invested amount. Return is a positive factor in every investment.…

Q: Which option is most profitable, keeping or replacing?Insert numerical value. What is one relevant…

A: The old machine is replaced with a new machine only when the production is improved and there is a…

Q: compare Future Value and Present Value?

A: The comparison between present value and future value is as follows:

Q: Consider IRR on Incremental Investment when Initial IRR Flows are equal?

A: Answer: IRR is a measure in capital budgeting used to measure the value of the predicted…

Q: Explain an example how to determine the future value.

A:

Q: Which of the following is not a variable in the basic present value equation? Multiple Choice…

A: Investors are holding securities for the purpose of gaining the returns. The return is calculated…

Q: What are some possible financial decisions in which using the Future Value (FV) formula might be…

A: The concept of time value of money states that the money received today is worth more than that the…