Question 1 2 pts Which of the following statements is CORRECT? Assume that the p

Question

Question 1 2 pts Which of the following statements is CORRECT? Assume that the project being considered has normal cash flows, with one outflow followed by a series of inflows O A project's regular IRR is found by discounting the cash inflows at the cost of capital to find the present value (PV), then compounding this PV to find the IRR 0 If a project's IRR is greater than the WACC, then its NPV must be negative. O To find a project's IRR, we must solve for the discount rate that causes the PV of the inflows to equal the PV of the project's costs. O To find a project's IRR, we must find a discount rate that is equal to the cost of capital. O A project's regular IRR is found by compounding the cash inflows at the cost of capital to find the terminal value (TV), then discounting this TV at the cost of capital.

Explanation / Answer

A normal Cash flow is type of cash flow in which only one cash outflow at begining of period and after that company get cash inflow from project.

IRR is the rate at which NPV of project is equal to Zero. that is the rate at which present value of future cash flow is equal to value of initial investment.

Option (C) is correct answer.

Related Questions

Navigate

• Browse (All)
• Browse Q
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.