Which of the costs are considering tax as is tax deductible

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Problem 1: Project X has a computed NVP of $381 and Project Magnito has a computed NVP of $231. Which one do you give merit and likely choose?

a. Project X
b. Project Magnito
c. Cannot tell

Problem 2: Which of the below costs are considering tax as it is tax deductible.

a. Cost of Equity
b. Cost of retained earnings
c. Cost of Debt

Problem 3: What is another term for stocks?

a. Bond
b. Cost
c. Equity

Problem 4: KN Inc's intrinsic value is calculated at $40 and it is currently trading at $38. The stock is________?

a. Undervalued
b. Just the same
c. Overvalued

Problem 5: If a company has a project which has cost of $30 million, and is expected to generated cash flow in the future of $55 million present value. What is the Profitability Index?

a. 1.23
b. 2.83
c. 1.83

Reference no: EM132932437

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