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pychu [463]
3 years ago
13

A firm's WACC can be correctly used to discount the expected cash flows of a new project when that project will: Multiple Choice

be financed solely with new debt and internal equity. have the same level of risk as the firm's current operations. be managed by the firm's current managers. be financed solely with internal equity. be financed based on the firm's current debt-equity ratio.
Business
1 answer:
Serggg [28]3 years ago
5 0

Answer:

...when that project will have the same level of risk as the firm's current operations

Explanation:

Weighted average cost of capital (WACC) is the company's cost of capital based on its proportion of equity and debt used in its capital structure. It can be used as the discount rate for calculating the present value of future expected cashflows of a project if the project is determined to be of similar risk to the company's operations; meaning that the estimated beta of the project is the same as the beta of the firm.

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Answer:

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Explanation:

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The choice that does not describe the balance sheet is D. The balance sheet contains only assets and liabilities sections.

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6 0
3 years ago
You have decided to buy a used car. The dealer has offered you two options: (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use
Jobisdone [24]

Answer:

$17,167

Explanation:

<em>The first step is to calculate amount of cash that would be charged</em>

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<em>Then</em>

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<em>Therefore the amount of cash the car dealer would charge is $17,167</em>

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3 years ago
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3 years ago
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