1. In a brief paragraph explain why Net Present Value considered to be a superior measure when making capital budgeting decisions? (7 marks) 4 2. You are to present a proposed capital investment project to your board of directors. The project has a NPV of $12,000 and an IRR of 12%. The firm's required return is 10%. You are to convey your proposal to the board in a single paragraph. In a brief paragraph, convince the board to either accept or reject the project, whichever you feel is appropriate given this information. (7 marks) mi Which one of the following is a reason why managers may utilize more than one method when analyzing a project? A. To determine a guaranteed rate of return on a projected project. B. To better understand the conditions under which the project can be successful. C. To ensure that the projected cash flows are accurate. D. Because there are multiple methods of analysis with basically no associated disadvantages. E. Because each of the five primary analytical methods is based on completely different data related to a proposed project. 4. The length of time required for an investment to generate cash flows sufficient to recover the initial cost of the investment is called the: A. Net present value. C. Payback Period B. Internal rate of return D. Profitability Index C. Payback period. 5. Net present value: A. Cannot be used when deciding between two mutually exclusive projects. B. Is more useful to decision makers than the internal rate of return when comparing different sized projects. C. Is easy to explain to non-financial managers and thus is the primary method of analysis used by the lowest levels of management. D. Is computed the same as present value when using excel spreadsheets to analyze a project. E. Is very similar in its methodology to the average accounting return. 6. In a brief paragraph Provide a definition of Depreciation (CCA) tax shield (5 marks) m English (United States) Accessibility: Investigate