23. The ______________________ is the compound annual rate of return that the fi

Question

23. The ______________________ is the compound annual rate of return that the firm will earn if it

                                                invests in a capital budgeting project and receives the estimated cash inflows.

                                                A. discount rate

                                                B. Internal Rate of Return (IRR)

                                                C. opportunity cost

                                                D. Weighted Average Cost of Capital (WACC)

______ 24. When the

Explanation / Answer

23 - B,. Internal Rate of Return (IRR)

24. -   A. greater than

25. - C. If the payback period is less than the maximum acceptable payback period, reject the project.

26. -  A. tax

27. - B. Independent; does not eliminate

28. -   A. the payback period

29. - D. capital rationing.

30. -   A. incremental cash flows.

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