The calculation of NPV assumes that cash flows are reinvested at what rate when

Question

The calculation of NPV assumes that cash flows are reinvested at what rate when 16. received? A. The market rate B. WACC C. IRR D. The project's discount rate (k) 17. Which measure considers the total risk Ge. systematic and uns combined) of a security? A. CAPM beta B. Jensen's alpha C. Sharpe Ratio D. Treynor Measure 18. Generally, which component of WACC has the least amount of cost based on the return desired by the given provider of capital? A. Cash from the firm B. Newly issued preferred stock C. Debt on an after-tax basis D. Newly issued common stock 19. Which component of WACC has a cost that is equivalent to a RADR? A. Cash from the firm B. Newly issued preferred stock C. Debt on an after-tax basis D. Newly issued common stock 20. Which measure considers the riskiness of the cash flows from a project the least? A. PI (profitability index) B. NPV C. PB (payback period) D. DPB (discounted payback period)

Explanation / Answer

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when there are more than one questions then as per chegg policy we have to answer first question.

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The calculation of NPV assumes that cashflows are reinvested at the project's cost of capital when recieved.

Therefore the correct answer is B) WACC

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