Need help with the followinghospitality finance questions...

QUESTION 1

By multiplying the EBITDA of a business by a factor of 9 to 12 the range of that business's total enterprise values can be estimated.True False

0.2 points

QUESTION 2

A lower cost of capital will decrease the capitalized value of the businees.True False

0.2 points

QUESTION 3

The appropriate interest rate to be used for discounting future cash flows is the cost of debt.True False

0.2 points

QUESTION 4

Computation of the payback method of project evaluation utilizes the time value of money.True False

0.2 points

QUESTION 5

More leverage will increase the cost of capital.True False

0.2 points

QUESTION 6

Lower business risk will lower the cost of equity.True False

0.2 points

QUESTION 7

If a business is consistently earning less than its cost of capital it should consider liquidation of some or all of its assets.True False

0.2 points

QUESTION 8

The capitalization rate method of valuation is based upon a perpetuity calculation.True False

0.2 points

QUESTION 12

Using a WACC = 12%, compute the Net Present Value of this set of annual cash flows:,667

,991

,923

,002(Please give your answer as a positive whole number with no dollar sign. That is if you believe the answer is $128.67, enter 129. If $4,257,777.10, enter 4257777.)

0.2 points

QUESTION 13

Using a WACC = 11%, compute the Net Present Value of this set of annual cash flows:,123

,491

CF3=-43,923

,002Note that CF3 is a negative number!(Please give your answer as a positive whole number with no dollar sign. That is if you believe the answer is $128.67, enter 129. If $4,257,777.10, enter 4257777.)

0.2 points

QUESTION 14

Using a WACC = 13%. compute the Net Present Value of this set of annual cash flows:,123

,491

CF3=-43,923

CF4=-12,002Note that CF3 and CF4 are negative numbers!(Please give your answer as a positive whole number with no dollar sign. That is if you believe the answer is $128.67, enter 129. If $4,257,777.10, enter 4257777.)

0.2 points

QUESTION 15

A restaurant has had a cash flow of $23,700 over the past twelve months. Compute the Capitalized Value of this restaurant using a WACC = 13%.(Please give your answer as a positive whole number with no dollar sign. That is if you believe the answer is $128.67, enter 129. If $4,257,777.10, enter 4257777.)

0.2 points

QUESTION 16

A restaurant has had a cash flow of $81,413 over the past twelve months. Compute the Capitalized Value of this restaurant using a WACC = 15%.(Please give your answer as a positive whole number with no dollar sign. That is if you believe the answer is $128.67, enter 129. If $4,257,777.10, enter 4257777.)

0.2 points

QUESTION 17

Compute the Internal Rate of Return of an investment which costs $120,000 and produces this set of annual cash flows:,123

,491

,923

,002Remember that the cost is always a negative number.(Please give your answer as a positive whole number with no percentage sign. That is if you believe the answer is 8.67%, enter 9. If 42.23%, enter 42.)

0.2 points

QUESTION 18

Compute the Internal Rate of Return of an investment which costs $95,000 and produces this set of annual cash flows:,123

,491

,923

,002Remember that the cost is always a negative number.(Please give your answer as a positive whole number with no percentage sign. That is if you believe the answer is 8.67%, enter 9. If 42.23%, enter 42.)

0.2 points

QUESTION 19

A manager is considering an investment which will produce an incremental cash flow of $47,000 per year. The project will cost $105,000. Compute the payback on this investment in years.(Please give your answer to the nearest tenth of a year. That is, if you believe the answer is 3.78, enter 3.8. If 2.34, enter 2.3.)

0.2 points

QUESTION 20

Using a WACC = 11%, compute the estimated Sales Price in Year 5 of a restaurant which is projected to generate this set of annual cash flows:,123,491,923,002(Please give your answer as a positive whole number with no dollar sign. That is if you believe the answer is $128.67, enter 129. If $4,257,777.10, enter 4257777.)