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polet [3.4K]
3 years ago
13

In general, firms should use their weighted average cost of capital (WACC) to evaluate capital budgeting projects because most p

rojects are funded with general corporate funds, which come from a variety of sources. However, if the firm plans to use only debt or only equity to fund a particular project, it should use the after-tax cost of that specific type of capital to evaluate that project. a. trueb. false
Business
1 answer:
Elodia [21]3 years ago
8 0

Answer:

b. false

Explanation:

Generally, this statement is incorrect because the company should be viewed as an ongoing company and the use of debt (or equity) to fund a given project will change the capital structure and this factor should determine the cost of capital on all projects on the target capital structure. "Prague Ekt financing "may be used and in particular the status of the project will be considered. It is a very specific situation, however, it" usually "is not.

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Kiley Electronics is considering a project that has the following cash flow data. What is the project's IRR? Note that a project
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Answer:

d. 13.31%

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IRR is the rate at which NPV = 0    

IRR 13.31%    

Year                                      0            1              2                3

Cash flow stream               -1100.000    450.000   470.000    490.000

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