Problem 1) Take the difference between the payback period of Projects A and B, i.e., calculate: X = Payback Period of Project A - Payback Period of Project B.

Select one:

a)-3

b)-2

c)-1

d)0

e)1

f)2

g)3

h)Insufficient information

Problem 1) What is (are) the posiive IRR(s) of Project C?

Select one:

a)0%

b)100%

c)104.3% is one of the IRRs and another IRR exists

d)0% is one of the IRRs and another IRR exists

e)7.7% only

f)56.3% is one of the IRRs and another IRR exists

Project C has three IRR

No positive IRR exists for Project C

Problem 1) What is the IRR of Project B?

Select one:

a)10.00%

b)6.70%

c)20.00%

d)100.00%

e)19.78%

f)Project B has multiple IRRs

g)IRR doesn't exist

h)IRR is negative

Problem 1) What is the NPV of Project C?

Select one:

a)$0

b)$1,238

c)$1,078

d)$455

e)-$365

f)-$25,000

g)$55,000

The NPV cannot be calculated because the last cash flow is negative

Problem 1) What is the payback period of Project D?

Select one:

A)1

B)2

C)3

D)4

E)5

F)6

G)7

Project D never pays back the initial investment

Problem 1) What is the profitability index (PI) of Project A?

Select one:

a)1.36

b)1.60

c)2.36

d)10%

e)$1,000

f)-$40,000

g)$14,206

h)PI is negative

Problem 1 You have the following projects available: Time Period Project A -$40,000.00 $35,000.00 $15,000.00 $9,000.00 $2,000.00 $3,000.00 Project Cash Flows Project B Project C -$40,000.00 -$25,000.00 $1,000.00 $78,000.00 $4,000.00 -$55,000.00 $16,000.00 $29,000.00 $32,000.00 Project D $9,000.00 $6,000.00 $1,000.00 Discount Rate 10% 10% 15% 6% Project A Project B Project C Project D Payback Period PI NPV IRRI IRR2 (if it exists) $15,912.79 Note: For simplicity, we measure payback period in full years (unlike the textbook). Calculate the numbers for the empty cells for Projects A to D. Hint: For some projects, a second (positive) IRR may exist. For Project D, the payback period may be easier to express in words