Based on CAPM, which of the following is a true statement The stock\'s total ris

Question

Based on CAPM, which of the following is a true statement The stock's total risk is measured by its Beta. The firm specific risk of a stock can be reduced by diversification Expected return of a company's stock should be determined by its its Standard deviation (sigma) measures stock's systematic risk. Out of the following methods of evaluating projects, which one of t consideration the time value of money? Payback period Internal rate of return Profitability index Net present value The internal rate of return is the: rate of return needed for a project to payback within the rate computed by discounting the cash inflows and dividing by rate of return that equals to firm's weighted average cost of discount rate that causes the net present value of a project to As the CFO of General Motor, you know your company has an Which one of the following projects would you accept if you make internal rate of return (IRR) and profitability index (PI) information Which one of the following methods of raising capital is associated burden) to the firm? Issuing new common stocks Issuing new preferred stocks Issuing new corporate bonds Keeping more retained earnings in the firm

Explanation / Answer

Answer:(3) D.discount rate that causes the net present value of a project to equal zero.

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