Project X Has the Following Cash Flows: C₀ = +2,000

question 66

Multiple Choice

Project X has the following cash flows: C₀ = +2,000, C₁ = -1,150, and C₂ = -1,150. If the IRR of the project is 9.85 percent and if the cost of capital is 12.00 percent, you would

• A)accept the project.
• B)reject the project.

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Definitions:

Modification

A change or alteration, often to a contract or agreement, altering its terms or conditions.

Dishonored

Referring to a financial instrument, such as a check or promissory note, that is not accepted or paid when presented for payment.

Note

A promise by the maker of the note to pay the payee of the note.

Reasonable Identification

The process of sufficiently identifying an individual through the use of valid and reliable means or documents.