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Gelneren [198K]
2 years ago
15

You are considering two mutually exclusive projects. Project A costs $3.6 million, has a required return of 14.5 percent, and an

IRR of 14.3 percent. Project B costs $4.1 million, has a required return of 16 percent, and an IRR of 15.6 percent. Which project(s) should be accepted
Business
1 answer:
sp2606 [1]2 years ago
3 0

Answer:

Neither

Explanation:

The internal rate of return is a capital budgeting method that is used to determine the profitability of a project.

Internal rate of return is the discount rate that equates the after-tax cash flows from an investment to the amount invested

The decision rule when using the internal rate of return is to undertake the project if the internal rate of return is greater than the required return of the project. If this is not met, the project should be rejected.

If choosing between multiple projects, the decision rule is to choose the projects with the highest internal rate of return. This is because that project would be the most profitable.

Neither of the project should be selected because the IRR of both projects is less than their required returns

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If the present value of $280 paid one year from now is $250 what is the one-year discount factor?
OleMash [197]

Answer:

12%

Explanation:

The discount rate  will be  PV/FV -1

i.e., i =  (Fv/pv )-1

i=  (280/250) - 1

i = 1.12-1

i=12%

7 0
2 years ago
Read 2 more answers
Thyme, Inc. owns 16,000 of Sage Co.'s 20,000 outstanding common shares. The carrying value of Sage's equity is $500,000. Sage su
DedPeter [7]

Answer:

The total non controlling interest after the additional shares are issued is equal to $252,000.

Explanation:

Before the issue Sage co's had 20,000 shares with total equity value of $500,000. After the issue of 5000 shares worth $200,000, the total number of shares and equity would be -

Total number of shares = 25,000 ( 20,0000 + 5000 )

Total equity value          = $700,000

Now Thyme inc owns 16,000 number of shares , which means that minority holds 9000 number of shares . Now the price per share would be =

       TOTAL EQUITY / NUMBER OF SHARES

         $700,000 / 25,000

=        $28

NON CONTROLLING INTEREST = Minority shares x Price per shares

                                                      = 9000 x $28

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8 0
3 years ago
In markets where customers are sensitive to price and where internal efficiencies lead to cost advantages allowing for acceptabl
Nadusha1986 [10]

Answer:

The correct answer is letter "A": Penetration.

Explanation:

Penetration Pricing means that an initially low price for a new product or service attracts customers away from the competitors. The new company hopes that even if prices rise to normal levels, customers will continue to use their products. Penetration Pricing will yield higher returns on sales and push rivals out of the market if implemented long enough.

3 0
3 years ago
Recently, you accepted an internship position with the Tulawaka Zoo in Tennessee. You report to Sharon Molacavage, the Senior An
Furkat [3]

Answer:

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Explanation:

Austrian organizational psychologist Fred Fiedler (<em>1922-2017</em>) proposed in his Theory of Contingency that leaders only have one leadership style and that they cannot shape it according to the different situations they might be involved in. Instead, leaders must be located in a situation that matches their style.

Since Sharon's leadership style is <em>autocratic</em>, she is likely to manage herself better in adverse situations where the subordinates still follow her instructions.

3 0
3 years ago
A first step when considering a career is to________.
Dafna1 [17]
The first step when considering a career is to assess yourself.
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3 years ago
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