Question 24 of 25 1 Points Which of the following statements is FALSE? i. Bonds with higher (better) credit ratings tend to have higher yields. ii. By convention the coupon rate is expressed as an effective annual rate. ill. Firms with higher credit risk tend to have higher credit spreads. iv. Yield to maturity is a weighted average of the market interest rates and is the average bond return. A. I, II and IV OB. II, III, IV C. I and I OD. I, II and it Reset Selection After spending $10,000 on client-development, you have just been offered a big production contract by a new client. The contract will add $200,000 to your revenues for each of the next 3 years and it will cost you $100,000 per year to make the additional product. You will have to use some existing equipment and buy new equipment as well. The existing equipment is fully depreciated, but could be sold for $50,000. If you use it in the project, you think you will still be able to sell it for $10,000 at the end. You will buy new equipment valued at $30,000 and straight-line depreciate it to zero over 3 years. It will be worthless at the end of the project. You will have to immediately increase your inventory from $20,000 to $30,000. It will return to $20,000 at the end of the project. Your company's tax rate is 35% and your discount rate is 15% First, answer the questions below to determine the incremental cash flows. What is the incremental (i.e. change in) cash flow in year 1? A. $68,500 B. $58,500 C. $42,500 OD. $32,500 Reset Selection MacBook Air Save Early. Save Olten and Save Externally! Alldata erased upon logout or reboot