Capital budgeting is the process of planning and also regulating investments in assets that are meant to create cash flows for even more than one year. This statement is:


You are watching: If an independent project with conventional

Which of these are examples of a resources budgeting project? a) Sanger Machine Co."s purchase of its normal stock of raw products inventoryb) National Transmissions Inc."s purchase of a competitor"s subsidiaryc) Wellington Industries Inc."s purchase of a brand-new item of equipmentd) Houston Hortisociety Co."s investment in a research study and advance programe) Lancashire Railmethod Co."s investment in employee education and also training programsf) Amalgamated Football League Inc."s $25,000 investment in short-lived marketable securities
b) National Transgoals Inc."s purchase of a rivals subsidiary c) Wellington Industries Inc."s purchase of a new item of devices d) Houston Horticulture Co,."s investment in a research study and advancement regimen e) Lancashire Railmeans Co."s investment in employee education and learning and also training programs
For which of the following reasons are funding budgeting decisions vital to a organization organization? Check all that use.a) Capital investments are fairly inexpensive.b) Capital investments have actually multiyear life spans, so mistakes linger for a long time.c) Capital investments are difficult to reverse without incurring large additional prices.d) Capital investments tend to require sizable cash outlays.e) Capital investments tfinish to reflect the firm"s future tasks, industries, and abundant technologies.f) Capital investments have actually relatively short life spans, so mistakes are functioned through quite conveniently.
b) Capital investments have multiyear life spans, so mistakes linger for a lengthy time c) Capital investments are hard to reverse without incurring large additional expenses d) Capital investments tend to need sizable cash outlays e) Capital investments tend to reflect the firm"s future tasks, sectors, and also abundant technologies
If tasks are mutually exclusive, only one job can be liked. The interior rate of rerevolve (IRR) and also the net present value (NPV) approaches will certainly not constantly choose the exact same job. If the crossover price on the NPV profile is listed below the horizontal axis, the techniques will ______ agree
When tbelow is a dispute, a crucial to resolving this it is assumed reinvestment price. The IRR calculation assumes that intermediate cash flows are reinvested at the ________________, and also the NPV calculation implicitly assumes that the price at which cash flows deserve to be reinvested is the _________________As a result, once evaluating mutually exclusive projects, the ______________ is normally the much better decision criteria
If an independent task through typical, or normal, cash flows is being analyzed, the net existing value (NPV) and also inner price of rerotate (IRR) methods _______ agree
If mutually exclusive tasks through normal cash flows are being analyzed, the net current value (NPV) and also interior rate of rerotate (IRR) approaches _____________ agree
Which of the complying with statements best explains what it indicates as soon as a job has actually an NPV of $0?a) When a task has actually an NPV of $0, the task is earning a rate of return much less than the project"s weighted average price of capital. It"s OK to accept the task, as long as the project"s profit is positive.b) When a job has an NPV of $0, the project is earning a price of rerevolve equal to the project"s weighted average cost of resources. It"s OK to accept a job via an NPV of $0, because the project is earning the compelled minimum price of rerevolve.c) When a project has an NPV of $0, the task is earning a profit of $0. A firm must refuse any kind of project with an NPV of $0, because the job is not profitable.
b) When a task has an NPV of $0, the project is earning a price of return equal to the project"s weighted average expense of capital. It"s OK to accept a job via an NPV of $0, bereason the project is earning minimum price of return
Suppose your boss has asked you to analyze two mutually exclusive projects—project A and also project B. Both projects call for the very same investment amount, and also the sum of cash inflows of Project A is bigger than the amount of cash inflows of job B. A coworker told you that you don"t need to execute an NPV evaluation of the projects because you already know that job A will have a larger NPV than task B. Do you agree via your coworker"s statement?a) No, the NPV calculation is based upon portion returns, so the dimension of a project"s cash flows does not influence a project"s NPV.b) Yes, task A will always have the largest NPV, bereason its cash inflows are higher than job B"s cash inflows.c) No, the NPV calculation will take right into account not just the projects" cash inflows yet likewise the timing of cash inflows and also outflows. Consequently, project B can have actually a bigger NPV than task A, also though project A has bigger cash inflows.
c) No, the NPV calculation will certainly take into account not only the projects" cash inflows yet likewise the timing of cash inflows and also outflows. Consequently, job B might have actually a bigger NPV than job A, also though task A has larger cash inflows
})}else;window.place.assign("https://urbanbreathnyc.com/explanations/textbook-solutions/principles-of-economics-8th-edition-9781305585126");">
*

})}else;home window.location.assign("https://urbanbreathnyc.com/explanations/textbook-solutions/krugmans-economics-for-ap-2nd-edition-9781464122187");">
*

})}else;window.place.assign("https://urbanbreathnyc.com/explanations/textbook-solutions/principles-of-microeconomics-6th-edition-9780538453042");">
*

})}else;window.area.assign("https://urbanbreathnyc.com/explanations/textbook-solutions/principles-of-microeconomics-7th-edition-9781285165905");">

Principles of Microeconomics7th EditionN. Gregory Mankiw
508 explanations
Sets uncovered in the same folder
home window.urbanbreathnyc.com<"productClickLinkData"> = <"name":"FinManFinalCh11","id":"87946468","price":"","category":"premium content","variant":"examine guide","position":"","brand":"rachel_morgan">; QLoad("urbanbreathnyc.com.productClickLinkData"); return;})}elsewindow.urbanbreathnyc.com<"productClickLinkData"> = <"name":"FinManFinalCh11","id":"87946468","price":"","category":"premium content","variant":"study guide","position":"","brand":"rachel_morgan">; QLoad("urbanbreathnyc.com.productClickLinkData"); return;;home window.place.assign("https://urbanbreathnyc.com/87946468/finmanfinalch11-flash-cards/");" id="1-87946468">
FinManFinalCh11
21 terms
rachel_morgan
window.urbanbreathnyc.com<"productClickLinkData"> = <"name":"Finance Exam 2 Ch. 5 6 7","id":"235405605","price":"","category":"premium content","variant":"research guide","position":"","brand":"Mack_Miller58">; QLoad("urbanbreathnyc.com.productClickLinkData"); return;})}elsehome window.urbanbreathnyc.com<"productClickLinkData"> = <"name":"Finance Exam 2 Ch. 5 6 7","id":"235405605","price":"","category":"premium content","variant":"examine guide","position":"","brand":"Mack_Miller58">; QLoad("urbanbreathnyc.com.productClickLinkData"); return;;home window.place.assign("https://urbanbreathnyc.com/235405605/finance-exam-2-ch-5-6-7-flash-cards/");" id="1-235405605">
Finance Exam 2 Ch. 5 6 7
43 terms
Mack_Miller58
window.urbanbreathnyc.com<"productClickLinkData"> = <"name":"Managerial Finance Chapter 14","id":"289534432","price":"","category":"premium content","variant":"study guide","position":"","brand":"gianteny">; QLoad("urbanbreathnyc.com.productClickLinkData"); return;})}elsehome window.urbanbreathnyc.com<"productClickLinkData"> = <"name":"Managerial Finance Chapter 14","id":"289534432","price":"","category":"premium content","variant":"study guide","position":"","brand":"gianteny">; QLoad("urbanbreathnyc.com.productClickLinkData"); return;;window.location.assign("https://urbanbreathnyc.com/289534432/managerial-finance-chapter-14-flash-cards/");" id="1-289534432">
Managerial Finance Chapter 14
77 terms
gianteny


See more: Which One Of These Documents Itemizes The Closing Costs And Explains The Terms Of Your Loan?

home window.urbanbreathnyc.com<"productClickLinkData"> = <"name":"Ch.11","id":"58391502","price":"","category":"premium content","variant":"study guide","position":"","brand":"luzgomez92">; QLoad("urbanbreathnyc.com.productClickLinkData"); return;})}elsehome window.urbanbreathnyc.com<"productClickLinkData"> = <"name":"Ch.11","id":"58391502","price":"","category":"premium content","variant":"research guide","position":"","brand":"luzgomez92">; QLoad("urbanbreathnyc.com.productClickLinkData"); return;;window.place.assign("https://urbanbreathnyc.com/58391502/ch11-flash-cards/");" id="1-58391502">