Is it true? Explain level II of American depository receipts assume that receipts on foreign company''s shares could be traded only among inntitutional investors, ami no new capital is raised with these issues. Which problems associated with the payback method, are NOT eliminated with the discounted payback period? Projects S and L arc equally risky, mutually exclusive, and have normal cash flows. Project S has an IRR of 15%. while Project L's IRR is 12%. The two projects have the same NPV when the WACC is 7%. Which of the following statements is CORRMCT? If the WACC is 10%. both projects w ill have positive NPVs. If the WACC is 6%. Project S will have the higher NPV. If the WACC is 13%, Project S will have the lower NPV If the WACC is 10%. both projects will have a negative NPV. Project S's NPV is more sensitive to changes in WACC than Project L's. f. None of the above. Is it true? Explain. If a project with normal cash flows has an IRR greater than the WACC, the Project must also have a profitability index higher than 1. Which of the following should be considered when a company estimates the cash flows used to analyze a proposed project? Since the firm's director of capital budgeting spent some of her time last year to evaluate the new projcct, j portion of her salary for that year should be charged to the project's initial cost. The company has spent and expensed $1 million on R&D associated with the new project. The new project is expected to reduce sales of one of the company's existing products by 5%. The company spent and expensed SI0 million on a marketing study before its current analysis regarding whether to accept or reject the project. The firm would borrow all the money used to finance the new project, and the interest on this debt would $1.5 million per year. 0 None of the above