A Project Will Give a One-Time Cash Flow of $22,000

question 51

Multiple Choice

A project will give a one-time cash flow of $22,000 after one year. If the project risk requires a return of 11%, what is the levered value of the firm with perfect capital markets?

• A) $15,855.86
• B) $19,819.82
• C) $23,783.78
• D) more information needed

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Definitions:

Literal

Taking words in their usual or most basic sense without metaphor or exaggeration.

Metaphor

A figure of speech in which a word or phrase is applied to an object or action to which it is not literally applicable, suggesting a comparison.

Sentence

A group of words that forms a complete thought, generally including a subject and a verb, that expresses a declaration, inquiry, exclamation, or directive.

Depression

A mental health disorder characterized by persistently depressed mood or loss of interest in activities, causing significant impairment in daily life.