21) Flim Fam Films (FFF) has some usable equipment that it wants to replace. It estimates that its additional annual banafi.. some usable equipment that it wants to replace. ft estimates that its A) $6,900 B) $4,600 C) $5,780 D) $6,520 22) Project An investor is considering investing in only one of the following securities: Which of the following statements is true? A) Security B is relatively less risky than Security C. B) Securities A and B are equally desirable if the investor is risk-averse. C) Securities B and Care of equal relative risk. D) Security C is more desirable than Security A if the investor is very risk-averse. 23) A company is considering a capital budgeting project that has a net outlay of $100,000 and generates cash flows of $16,274.45 annually for 10 years. The rate of return on the project is closest to A) 11 percent B) 8 percent C) 9 percent D) 10 percent 24) A profitability index of .85 for a project means that A) the payback period is less than one year B) the project's NPV is greater than zero C) the project returns 85 cents in present value for each current dollar invested D) the present value of benefits is 85% greater than the project's costs 25) Hi lighter, Inc, is considering a project with an initial investment of $50,000 that generates ye end cash-inflows of $20,000 per year for 8 years starting one year from today. What is the net present value of this project if the firm requires a 15% rate of return? A) $45,708 B) $110,000 C) $42,700 D) $39,746 26) A correlation coefficient of 0.7 indicates that the returns from two securities A) are perfect mirror images of each other B) tend to move in opposite directions C) move independently of each other D) tend to move in the same direction