If WiseGuy Inc uses IRR rule to choose projects, which of the projects (Project A or Project B) will rank highest? An investor is considering a project that will generate $800,000 per year for four years In addition to upfront costs of $1,500,000. at the completion of the project at the end of the fifth year there will be shut-down costs of $500,000. If the cost of capital is 5%, what ts the MIRR When different investment rules give conflicting answers, then decisions should be based on the Net Present Value rule, as it is the most reliable and accurate decision rule An investor has a budget of $5 million. He can invest in the projects shown above If the cost of capital is 6%, what investment or investments should he make? Which of the following best defines incremental earnings? the earnings arising from all projects that a company plans to undertake in a fixed turn-span the amount by which a firm's earnings are expected to change as the result of an investment decision cash flows arising from a particular investment decision the net present value (NPV) of earnings that a firm is expected to receive as the result of an investment decision Vernon-Nebon Chemicals is planning to release a new brand of insecticide, Bee-Safe, that will kill many insect pests but not harm useful pollinators Buying new equipment to manufacture the product will cost $20 million, and there will be an additional $2 million cost to reconfigure existing plant. The equipment is expected to have a lifetime of right years and will be depreciated by the straight-line method over its lifetime The firm expects that they should be able to sell 1.500,000 gallons per year at a price of $52 per gallon It will take S38 per gallon to manufacture and support the product If Vernon-Nebon's marginal tax rate is 40%, what are the incremental earnings in year 3 of this project? Which of the following costs would you consider when making a capital budgeting decision