<span>The answer is D.) A contract can be enforced even if the agreement contains an illegal activity.</span>
Answer:
Eagle Corp is more likely to create value while Myna Bird Inc. is more likely to destroy value
Explanation:
Given that,
In Eagle Corps,
Return on invested capital (ROIC) = 15%
Cost of capital = 12%
In Myna Bird Inc.,
Return on invested capital (ROIC) = 22%
Cost of capital = 25%
By Investing in Eagle Corps,
= 15% - 12%
= 3%
By Investing in Myna Bird Inc.,
= 22% - 25%
= -3%
Above information tell Mark that by investing in Eagle Corps he can get the positive returns of 3% whereas by investing in Myna Bird Inc. he can get the negative returns of 3%.
Therefore, Eagle Corp is more likely to create value while Myna Bird Inc. is more likely to destroy value.
Worksheet for capital budgeting, a way to observe the bargain charge to coins glide so you can bargain the future coins flows: one plus the bargain price raised to the range of years inside the future, then divide trash glide.
Capital budgeting is the technique that an enterprise makes use of to determine which proposed fixed asset purchases it needs to take delivery of, and which should be declined. This technique is used to create a quantitative view of each proposed fixed asset funding, thereby giving a rational foundation for creating a judgment.
Capital budgeting is the method a business undertakes to assess capacity for main tasks or investments. creation of a brand new plant or a huge investment in an outside mission are examples of tasks that would require capital budgeting earlier than they're authorized or rejected.
Capital budgeting, and investment appraisal, in corporate finance, is the planning process used to decide whether or not a corporation's long-term investments which include new equipment, an alternative of machinery.
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