QUESTION 15 CAPITAL BUDGETING. For this and the next 2 questions: Consider the following cash flows. Cost of capital is 12 percent. Calculate the NPV of the project. Year Cash Flow 0 -600 125 250 3 215 -$21.67 $1,173.33 $21.67 $1,173.33 QUESTION 16 CAPITAL BUDGETING. For the above project, calculate the IRR. 10.97% 21.67% 10.35% 11.73% QUESTION 17 CAPITAL BUDGETING. Please consider again the above project. Suppose the project's cost of capital is 8% instead of 12%. Given this new information, what should be the correct capital budgeting decision based on the NPV? Project should be rejected. NPV is negative Project should be rejected. Project's cash flows are non-normal. Project should be accepted although NPV is negative Project should be accepted. NPV is positive. QUESTION 18 INTEREST RATES. Which of the following bonds is backed by the full faith and credit of the United States government and is therefore considered "riskfree?" Treasury bonds AAA-rated corporate bonds Municipal bonds Euro bonds Screenshot