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9. An investment with an initial cost of $15,000 produces cash flow is evenly spread out over the year and the firm period is A,3- years. C.3.75 E. 5 cash flows of $5,000 annually for 5 years If the can borrow at 10%, the discounted payback B. 3.2 D. 4 10. The Winston Co. is considering two mutually exclusive projects with the following RR is and if the required rate is higher than the crossover rate should be accepted. then project Project A Year Project B $75,000 $30,000 $35,000 $35,000 -560,000 $25,000 $30,000 $25,000 A, 13.94%; A C. 15.44%; A E. 15.86%; A 11. B. 13.94%; D, 15.44%; B Based on the profitability index (PI) rule, should a project with the following cash flows be accepted if the discount rate is 8%? why or why not? Year Cash Flow -$18,600 $10,000 S 7.300 S 3,700 B. yes; because the Pl is 992. D. no; because the Pl is 1.008 A. yes; because the Pl is 1.008 C. yes; because the Pl is 999 E. no; because the Pl is .992. 12. The primary reason that company projects with positive net present values are acceptable is that: A. they create value for the owners of the firm. B. the project's rate of return exceeds the rate of inflation. C. they return the initial cash outlay within three years or less. D. the required cash inflows exceed the actual cash inflows. E. the investment's cost exceeds the present value of the cash inflows 13. The discounted payback rule may cause: A. some positive net present value projects to be rejected. B. the most liquid projects to be rejected in favor of less liquid projects. C. projects to be incorrectly accepted due to ignoring the time value of money D. some projects with negative net present values to be accepted. E. Both A and D. considered