Question

Net present value is only a financial and economic criterion for selecting a project. What other factors may be important in accepting the project?

Answer #1

improving relationships with suppliers & customers

Political issues-meeting requirements of current & future
legislation

matching industry standards & good practice

shareholders’ requests

improving business reputation & relationships with local
community

improving staff morale

developing capabilities such as building skills & experience in
new areas/strengthening management systems

anticipating & dealing with future threats, e.g., protecting
intellectual property from potential competition

Net present value is only a financial and economic criterion for
selecting a project. What other factors may be important in
accepting the project?

What type of Capital budgeting Financial decisions may call for
the use of Net Present value only and how may that increase the Net
Present Value of that project.

What is profitability Index? Which is a superior
criterion-Profitability Index or Net Present Value?

If the net present value of a project is −$10,000, and the net
present value of leasing for the project is +$12,000, calculate the
APV (adjusted present value) of the project.
Group of answer choices
($10,000)
($2,000)
$2,000
$12,000

7. Explain why accepting all economic projects yielding
a positive Net Present Value could lead to an excessive amount of
government regulation

When using the Net Present Value method,
A project is acceptable if the present value of benefits equals
the present value of outflows.
A project is acceptable if the present value of benefits exceeds
a specified minimum value.
None of the answers provided is correct
A project is acceptable if the required rate of return on the
project is equal to the cost of the firm’s capital.
Projects with positive net present values increase the value of
the firm.

1. A company calculates the expected net present value of a
project as $350,000. The standard
deviation is $200,000.
a. What is the probability that the project will have a net
present value between $350,000 and
$600,000?
b. What is the probability that the project will have a negative
net present value?

What will be the net present value of a project that provides
net cash flow of $20,000 at the end of the first year, $7,000 at
the end of the second year, and $13,000 at the end of the third
year? The initial cost is $8,000 and the appropriate discount rate
is 10%.
Tophill Corporation is considering a project that will pay
$10,000 at the end of the first year, $22,000 at the end of the
second year, and $40,000...

A project with a negative net present value indicates that?

Project A has a net present value of $1,500, a payback period of
2 years, and an internal rate of return of 12%. Project
B has a net present value of $1,800, a payback period of 4 years,
and an internal rate of return of 10%. Project C has a
netpresent value of $1,750, a payback period of 3 years, and an
internal rate of return of 11%. If the projects are
mutually exclusive, which project should be undertaken?
A.
Project A because...

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 59 seconds ago

asked 1 minute ago

asked 3 minutes ago

asked 13 minutes ago

asked 22 minutes ago

asked 37 minutes ago

asked 45 minutes ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 2 hours ago

asked 2 hours ago