Year Cash Flow Year 1 $350,000 Year 2 $425,000 Year 3 $425,000 Year 4 $400,000 If the project's weighted average cost of capital (WACC) is 8%, what is its NPV? $348,951 $332,334 $299,101 $282,484 Which of the following statements indicate a disadvantage of using the discounted payback period for capital budgeting decisions? Check all that apply. The discounted payback period does not take the project's entire life into account. The discounted payback period does not take the time value of money into account. The discounted payback period is calculated using net income instead of cash flows.
Year Cash Flow Year 1 $350,000 Year 2 $425,000 Year 3 $425,000 Year 4 $400,000 If the project's weighted average cost of capital (WACC) is 8%, what is its NPV? $348,951 $332,334 $299,101 $282,484 Which of the following statements indicate a disadvantage of using the discounted payback period for capital budgeting decisions? Check all that apply. The discounted payback period does not take the project's entire life into account. The discounted payback period does not take the time value of money into account. The discounted payback period is calculated using net income instead of cash flows.
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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Transcribed Image Text:Year
Cash Flow
Year 1
$350,000
Year 2
$425,000
Year 3
$425,000
Year 4
$400,000
If the project's weighted average cost of capital (WACC) is 8%, what is its NPV?
$348,951
$332,334
$299,101
$282,484
Which of the following statements indicate a disadvantage of using the discounted payback period for capital budgeting decisions? Check all that
apply.
The discounted payback period does not take the project's entire life into account.
The discounted payback period does not take the time value of money into account.
The discounted payback period is calculated using net income instead of cash flows.
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