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2 Which of the following statements is correct? Marks o a. If securities are fairly priced, the net present value of a fixed set of
2 Which of the following statements is correct? Marks o a. If securities are fairly priced, the net present value of a fixed set of cash flows is independent of how those cash flows are financed. ob. Fixed dividends on preferred equity, similar to fixed coupon payments for bonds, are tax deductible. Dividends on common equity is not tax deductible. O c. Cost for a property survey should not be included in the capital budgeting decision because it is an opportunity cost. o d. To the extent that overhead costs are fixed and will be incurred in any case, they are incremental to the project and should be included in the capital budgeting analysis. Oe. Sunk costs are incremental with respect to the current decision regarding the project and should be included in its analysis
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