Question 1 (1 point) You purchase an equipment now for your company for $10,000. You will sell the equipment for $7200 after 2 years. The marginal tax rate for your company is 40%. If the CCA rate is 20% and the required rate of return on this project is 10%. What is the present value of CCA tax shield? $933.24 $904.32 $1022.17 O $958.68 ( $958.68 Question 2 (1 point) If a project with conventional cash flows has a profitability index less than one, then: The payback period is less than the maximum acceptable period. The IRR is greater than the required return. The discounted payback period is greater than the project's life. O The NPV is positive. Question 3 (1 point) Question 3 (1 point) Roger is considering adding toys to his general store. He estimates that the cost of inventory will be $6,400. The remodeling expenses and shelving costs are estimated at $2,100. Toy sales are expected to produce net cash inflows of $1,400, $2,300, $3,100, and $2,000 over the next four years, respectively. Should Roger add toys to his store if he assigns a three-year payback period to this project? Why or why not? No; The payback period is 3.55 years. Yes; The payback period is 2.55 years. No; The payback period is 3.85 years. Yes; The payback period is 2.87 years. Question 4 (1 point) A firm that faces capital rationing must select a subset of capital projects based on some ranking criterion. The capital budgeting technique best suited for this is the