A Project Has an Up-Front Cost of $100,000

question 72

Multiple Choice

A project has an up-front cost of $100,000. The project's WACC is 12 percent and its net present value is $10,000. Which of the following statements is most correct?

• A) The project should be rejected since its return is less than the WACC.
• B) The project's internal rate of return is greater than 12 percent.
• C) The project's modified internal rate of return is less than 12 percent.
• D) All of the above answers are correct.
• E) None of the above answers is correct.

Comprehend the role of medical imaging in diagnosing and monitoring the treatment of various conditions.

Understand how to derive the supply function from a given production function.

Comprehend the relationship between costs, prices, and supply in the long-run economic model.

Determine the minimum price required for a firm to supply a positive amount of output in the long run.

---

Definitions:

Saving

The portion of income not spent on current consumption but set aside for future use.

Fiscal Policy

Policies by the government involving taxes and expenditure to impact the economic situation.

Great Depression

A severe worldwide economic downturn that took place during the 1930s, characterized by significant declines in industrial production, massive unemployment, and deflation.

Aggregate Demand

The total consumption needs for goods and services within an economy, considering the current price level throughout a certain period.