Discount rate being used will equal the projects irr

Assignment Help Financial Management

Reference no: EM13915233

Explain the following statement: “When the NPV of a project = $0, the discount rate being used will equal the project’s IRR.” Use math to explain your answer. Hint: Equations 10-1 and 10-2 may help with the math.

Reference no: EM13915233

Questions Cloud

Evidence of abnormal rate of return on project : In a capital budgeting context, explain how a positive NPV is evidence of an “abnormal” rate of return on a project.

What is the difference between the general journal : What is the difference between the general journal and special journals?

Most part the market for financial securities : Briefly explain the following statement: For the most part the market for financial securities is efficient while the market for capital budgeting ideas is not.

Do all companies close their books on december 31 : Do all companies close their books on December 31? Why or why not?

Discount rate being used will equal the projects irr : Explain the following statement: “When the NPV of a project = $0, the discount rate being used will equal the project’s IRR.” Use math to explain your answer. Hint: Equations 10-1 and 10-2 may help with the math.

Cost of capital and liabilities and equity : Find the 3 weights to be used to determine the cost of capital (Debt, Preferred, and Common equity weights) using market value and book values. Find the component costs (%) for bonds (rd), preferred stock(rp), retained earnings(rs) and new issue comm..

Monthly level of sales dollars : What is the monthly level of sales dollars needed to break even-What is the monthly level of sales dollars needed to earn an operating profit of $10,000 monthly.

Explain how financial leverage impacts the return on equity : Explain how financial leverage impacts the return on equity ratio.

Currently selling-pay year-end dividend : Firm X’s stock is currently selling for $60 a share. The firm is expected to earn $5.40 per share this year and to pay a year-end dividend of $3.60. Show your work.

User Account

All Pages