If a project has a cost of $50,000 and a profitability index of 0.4, then:
A) its NPV is $20,000
B) its cash inflows are $70,000
C) the present value of its cash inflows is $30,000
D) its IRR is 20 percent
Answer: A) its NPV is $20,000
You might also like to view...
When a broker has two offers on the same property, both from salespeople within his office, and both with a deposit, he is placed in a dilemma. He decides not to present the second offer until the first offer has been accepted or rejected by the seller. The seller is not informed of the second offer. The broker's action is:
A: Permissible if the second offer is substantially the same as the first; B: Permissible only if the commission is divided equally between the salespersons; C: Not permissible since he owed the fiduciary obligation to both buyers; D: Not permissible.
An endorsement in which the endorser does not guarantee that an instrument will be accepted and paid by the drawer or maker is referred to as a ________
A. conditional endorsement B. restrictive endorsement C. qualified endorsement D. special endorsement