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True/False and Why: 1. An IRR lower than the WACC should always be rejected. 2. The IOS chart tracks total capital expended on the x-axis
True/False and Why:
1. An IRR lower than the WACC should always be rejected.
2. The IOS chart tracks total capital expended on the x-axis and NPV on the y-axis.
3. It is possible that the firm may be unable to invest despite an IRR higher than WACC.
4. Break points occur when total capital expended passes a threshold which makes it more risky and thus more costly.
5. Firms should always leave their options open for adding to any debt or equity capital position.
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