While evaluating capital investment proposals, the time value of money is considered in case of

Related MCQs

• You are considering two mutually exclusive investment proposals, project A and project B. B's expected value of net present value is $1,000 less than that for A and A has less dispersion. On the basis of risk and return, you would say that
• Two mutually exclusive investment proposals have "scale differences" (i.e., the cost of the projects differ). Ranking these projects on the basis of IRR, NPV, and PI methods give contradictory results.
• Evaluation of Capital Budgeting Proposals is based on Cash Flows because:
• A project requires an investment of Rs500000and has scrape value of Rs.20000 after five years. It is expected to yield profits after depreciation and taxes during the five years amounting to Rs.40000,Rs60000, Rs.50000,Rs70000 and Rs20000.What is the average rate of return on the investment?
• Capital Budgeting techniques which considers the time value of money is based on
• What is the value of the tax shield if the value of the firm is $5 million, its value if unlevered would be $4.78 million, and the present value of bankruptcy and agency costs is $360,000?
• A company should arrange the capital structure in such a way that there is maximum flexibility in the capital and cost of capital is
• While calculating the weighted average cost of capital, market value weights are preferred because
• According to which theory two identical firms in all respect except their capital structure can not have different market value or cost of capital because of arbitrage process
• A company can increase its value and reduce the overall cost of capital by increasing the proportion of debt in its capital structure according to ----- approach