You Are Considering a Project with Conventional Cash Flows and the Following

question 31

Multiple Choice

You are considering a project with conventional cash flows and the following characteristics: Which of the following statements is correct given this information?
I.The discount rate used in computing the net present value was less than 11.63 percent.
II.The discounted payback period must be more than 2.98 years.
III.The discount rate used in the computation of the profitability ratio was 11.63 percent.
IV.This project should be accepted as the internal rate of return exceeds the required return.

• A)I and II only
• B)III and IV only
• C)I, II, and IV only
• D)II, III, and IV only
• E)I, II, III, and IV

---

Definitions:

Yerkes-Dodson

A theory describing the relationship between arousal and performance, suggesting there is an optimal level of arousal for maximum performance.

James-Lange Theory

A theory of emotion proposing that emotions occur as a result of physiological reactions to events, suggesting that bodily responses precede emotions and help in identifying them.

Physiological Changes

Alterations in the body's normal biological functions, which can be responses to various factors including stress, environmental changes, or health conditions.

Happiness

A state of well-being and contentment characterized by positive or pleasant emotions ranging from contentment to intense joy.