Verizon 2:23 PM 55% Done 17 of 17 ? Modle 5e Exam 5 Material-5 ? QUESTION 1 × Ta

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Verizon 2:23 PM 55% Done 17 of 17 ? Modle 5e Exam 5 Material-5 ? QUESTION 1 × Take Test: Exam 5-SUT8.FIN. ? secure https/utclearn.blackboard.com/webappsassessmenttake/aunchjsp?.. 5.00000 points Save Answer Which one of the following statements is NOT correct? If the initial cost of a project is increased, the net present value of that project will decrease. The MIRR is specifically designed to address conventional cash flows. If the internal rate of return equals the required return, the net present value will equal zero. discounted to today's dollars minus the initial cost of the Net present value is negative when the required return Net present value is equal to the investment's cash inflows exceeds the internal rate of return. QUESTION 2 5.00000 points Save Answer Which one of the following methods of analysis could completely ignore some cash flows? Net present value Internal rate of return Payback period rule Profitability index None of the above 5.00000 points Save Answer QUESTION 3

Explanation / Answer

1.Option 2. MIRR is not used for convenmtional cash flows. It is more effective when the sign of the cash flows change more than 2 times or multiple times. Here IRR yield stwo or more numbers. Hence MIRR is better.

2. Option 3 Pay back period doesnot include cash flows beyoond the period of Payback. It includes only cash flows before payback.

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