Capital Budgeting Decision Rules: 1. Payback period approach in capital budgeting evaluation process fails to consider all cash flows and the time value of money. True False 2. If a projects NPV is positive, then it is IRR is greater than its cost of capital. True False A project will cost $160,000. The after-tax future cash flows are expected to be $40,000 annually for 7 years. For #3-5. 3. What is the projects payback period? A. 1.5 yrs B. 2.0 yrs C. 3.3 yrs D. 4.0 years E. 4.3 years 4. Assume the required return is 10%. What is the projects NPV? A. $14,111 B. $27,322 C. $32,556 D. $34,737 E. $45,001 5. Assume the required return is 17%. What is the projects IRR? Accept? A. 12.2%; yes B. 12.2%; no C. 16.3%; yes D. 16.3%; no E. 17.0%; indifferent 6. XYZ company is planning to buy the ABC company. The acquisition would require an initial investment of $190,000, but in one year XYZ company's after-tax net cash flows would increase by $24,000 and remain at this new level annually forever. Assume a cost of capital of 10 percent. Should XYZ buy ABC? Please provide all work for these problems not just final solutions so they can be modeled for other similar problems. Thank you :)