Question
Consider business projects A=(a,a,a,..., an) and B=(b,b,b,..., bn) where a=b <0 and all other cashflows in both projects are positive. Evaluate the following statements: True,
Consider business projects A=(a,a,a,..., an) and B=(b,b,b,..., bn) where a=b<0 and all other cashflows in both projects are positive. Evaluate the following statements: True, false, it depends? Explain each answer in less than 10 lines.
a. If A has finite PP, A has finite DPP.
b. If NPV of A is positive, A must necessarily have finite PP.
c. If a project A has smaller DPP than B, A must also have smaller NPV.
d. If A has positive IRR, A has finite PP.
e. If A has smaller NPV than B, A also has smaller IRR.
f. Both A and B have a unique IRR.
g. If DPP(A) < DPP(B) then PP(A) < PP(B)
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