9. future benefits foregone when one option is chosen over another are called

a. future costs

b. sunk costs

c. relelvant cost

d. opportunity cost

10. If a project requires an initial investment of 1,000,000 and will return 1,263,376 after 2 years, whats the internal rate of return of the project?

a. 11.4%

b. 11.6 %

c. 12.4%

d. 12.6%

11. Project A requires an initial investment of 40,000 and will return 10,000 annually at the end of each year for 10 years. Project B requires an initial investment of 80,000 and will return 40,000 anually beginning at the end of year 3 for 5 years. Which of the following regarding cash payback period is correct?

a. project A has shorter cash payback period

b. project B has short cash payback peruiod

c. project A and B have the same cash payback period

12. Which of the following is true regarding depreciation tax shield

a. it is calculated as depreciation x (1-tax rate) and oncreases tax payment

b. it Is calculated as depreciation x tax rate and increases tax payment

c. it Is calculated as depreciation x (1-tax rate) and decreases tax payment

d. it Is calculated as depreciation x (1-tax rate) and increases tax payment