QUESTION 16 A project has a cash outflow of $24.000 at time zero and a projected annuity inflow of $6,000 over the next 8 years. The projects cost of capital is 6%. What is the project's Internal Rate of Return (IRR)? Hint: Solve for NPV and then IRR. a. 18.62% Ob 22.56% O c 25.7896 d. 30.23% QUESTION 17 Which of the following capital budgeting techniques will require you to try different discount rates until you find a rate that gives a NPV equal to zero, unless you have a financial calculator? a profitability index. b.internal rate of return. Oo net present value. d. accounting rate of return QUESTION 18 Mulligan, Inc. is currently considering an eight-year project that has an initial outlay or cost of $140,000. The cash inflows from its project for years 1 through are the same at $35,000. Mulligan has a discount rate of 12%. Because there is a shortage of funds to finance all good projects, Mulligan wants to compute the profitability index (PI) for each project. That way Mulligan can get an idea as to which project might be a better choice. What is the PI for Mulligan's current project? a. about 1.24 O b. about 1.31 O about 1.50 Od 1.64 QUESTION 19 Capital projects are said to be mutually exclusive when: O a the financial viability of a single project is being evaluated. O b. two or more projects are being evaluated and doing one keeps you from doing another. Ocone project is much easier to do than another d. none of a number of projects should accepted. QUESTION 20 Use common sense to determine the rank order the following capital project types according to level of risk, from highest risk to lowest risk. a. Expansion, New Venture, Replacement. O b. New Venture, Expansion. Replacement Oc Replacement, Expansion, New Venture. d. Expansion, Replacement, New Venture