Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Western Beef Exporters is considering a project that has an NPV of $32,600, an IRR of 15.1 percent, and a payback period of 3.2 years.

Western Beef Exporters is considering a project that has an NPV of $32,600, an IRR of 15.1 percent, and a payback period of 3.2 years. The required return is 14.5 percent and the required payback period is 3.0 years. Which one of the following statements correctly applies to this project? The net present value indicates accept while the internal rate of return indicates reject. Payback indicates acceptance. The payback decision rule could override the accept decision indicated by the net present value. The payback rule will automatically be ignored since both the net present value and the internal rate of return indicate an accept decision. The net present value decision rule is the only rule that matters when making the final decision.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Understanding Terrorist Finance

Authors: T. Wittig

2011th Edition

0230291848, 978-0230291843

More Books

Students also viewed these Finance questions

Question

How We Listen?

Answered: 1 week ago