Remaining Time 1 hour 25 minutes 51 seconds v Question Compl

Remaining Time: 1 hour, 25 minutes, 51 seconds v Question Completion Status: Maving to another queetion will save this response Question 16 The payback period method O takes consideration of the time value of money O is compared to pre-determined out-off date. O is no more in use in businesses ?is toquenty adopted by managers due to its sophisticated calculation Moving to another question will save this reaponse MacBook Air ?0 F3 9 7 5 6 4 2 3

Solution

Question 16 :

The payback period method is compared to pre-determined cut off date.

Question 17:

Answer is \'Neither of these\'

Working:

Question 18.  

Answer is Current Assets - Current Liabilities

Question 19.

Answer is \'An informed investor would not pay more for real estate than what it would cost to buy the land and and build the structure.\'

Question 20.

Aswer is False.

The capital invested is to be earned back as early as possible, since the invesor will not have control on the external market and industry.

	Project A	Project B
0	1-6	0	1-4
Initial Investment	-600000	120000	-740000	200000
Cost of capital	10%	10%	10%	10%
PV factor	1	4.355	1	3.170
Present Value	-600000	522600	-740000	634000
Net Present Value	-77400		-106000
IRR	5%		3%