D Question 19 0.5 pts Suppose you have an investment that costs $80,000 at the beginning of the project, and it generates $30,000 a year for four years in positive cash flows. The cost of capital is 12%. The IRR of the project is 18.45% and the NPV is about $11.120. The IRR model assumes that at the end of the first year you can invest the $30,000 at O a rate greater than the IRR O 12.00% O 18.45% O a rate less than the cost of capital 0.5 pts Question 18 Which of the statements below is TRUE? For every period that the cash flow has a change of sign (negative to positive or positive to negative), the NPV profile could cross the y-axis, generating a MIRR. O When we talk about standard cash flow for a project, we assume an initial cash outflow at the beginning of the project and negative cash flows in the future. o When we apply IRR to standard cash flow, we have the potential for more than one IRR solution One problem with IRR as a decision rule is that if the cash flow is not standard, there is a possibility of multiple IRRs for a single project. 0.5 pts 2 pts Question 15 Alcan, Inc. is considering a project that has an initial outlay or cost of $220,000. The respective future cash inflows from its four-year project for years 1 through 4 are: $50,000, 560,000, 4 $70,000, and $80,000, respectively. Alcan uses the internal rate of return method to evaluate projects. Will Alcan accept the project if its hurdle rate is 12%? O Alcan will not accept this project because its IRR is about 4.66%. Alcan will not accept this project because its IRR is about 9.74% O Alcan will not accept this project because its IRR is about 6.50%. O Alcan will not accept this project because its IRR is about 7.63%. 0.5 pts