Considering project with the data-payback period

Assignment Help Financial Management

Reference no: EM131048680

You are considering a project with the following data: IRR = 8.7 percent; PI = .98; NPV = -$393; Payback period = 2.44 years. Which one of the following statements is correct given this information?

The discount rate used in computing the net present value must have been less than 8.7 percent.

The discounted payback period will have to be less than 2.44 years.

The discount rate used to compute the profitability ratio was equal to the internal rate of return.

This project should be accepted based on the profitability ratio.

The required rate of return must be greater than 8.7 percent.

Reference no: EM131048680

Questions Cloud

Understand the culture of an organization : It is important to understand the culture of an organization when making decisions? If you are new to a company, or even a department within a company, how do find out what the "culture" is regarding decision-making?

What was the operating cash flow per share : Weston Corporation had earnings per share of $1.91, depreciation expense of $514,000, and 200,000 shares outstanding. What was the operating cash flow per share? If the share price was $71, what was the price-cash flow ratio?

Dog along reduces the effect of stress : Dogs, friends, and stress. If you are a dog lover, perhaps having your dog along reduces the effect of stress. To examine the effect of pets in stressful situations, researchers recruited 45 women who said they were dog lovers.

Prepare a streamlined version of the key elements : To feel confident that all of the employees in your strategic planning team understand all that you have taught them, you require each to prepare a streamlined version of the key elements of a strategic plan

Considering project with the data-payback period : You are considering a project with the following data: IRR = 8.7 percent; PI = .98; NPV = -$393; Payback period = 2.44 years. Which one of the following statements is correct given this information? This project should be accepted based on the profit..

Importance of the content on qualitynet website : Discuss in a one to two page paper the importance of the content on QualityNet Website and how it relates to care we provide as healthcare workers and services we receive as customers, with at least two references.

Managing a fixed expense department or variable expense : Describe your preference: managing a fixed expense department or variable expense department. Why? What are the pros and cons of both?

Evaluation in nonprofits-associations : Define the key concepts of validity and reliability. How are they related and not related? Support your answer with examples. What are some potential ethical "mine fields" in this area?

Determine the z and y parameters for the circuit : Determine the z and y parameters for the circuit

User Account

All Pages