The discount rate used to calculate the net present value of a capital budgeting project should be: a. The risk-free rate. b. The weighted average cost of capital. c. LIBOR. d. The internal rate of return.

Answers

Answer 1

Answer:

B

Explanation:

Capital budgeting is the determination of the profitability of proposed investments

One of the capital budgeting methods is the net present value

Net present value is the present value of after-tax cash flows from an investment less the amount invested.

the Weighted cost of capital is used to determine NPV

WACC = weight of equity x cost of equity + weight of debt x cost of debt x (1 - tax rate)

It is the minimum rate of return a company expects from a project

Internal rate of return is the discount rate that equates the after-tax cash flows from an investment to the amount invested. It is a captial budgeting method


Related Questions

WILL GIVE BRAINLIEST PLS ANSWER (PERSONAL AND FAMILY FINANCE)

Yusef’s financial advisor tells him that he has made a great budget. Why was he MOST likely successful with his budget?

A.
He refused to accept any changes to it.

B.
He did not share the information with his family.

C.
He chose realistic amounts for each category.

D.
He was the only member of the family who crafted it.

Answers

Answer: A

Explanation:

Yusef’s financial advisor tells him that he has made a great budget. He is most likely successful with his budget because he refused to accept any changes to it. Option (a) is correct.

What do you mean by Budget?

A budget is a financial plan that projects future earnings and costs.

The Personal and Family Finance assessment and certification will cover both foundational skills for personal and family finance careers as well as skills required for success in managing personal and family financial matters in daily life (a necessary skill set to maximize success in all career areas).

The phrase "personal finance" refers to managing your finances as well as saving and investing. It includes financial planning for retirement, taxes, and estates, as well as banking, insurance, mortgages, and investments.

Therefore, Option (a) is correct. He refused to accept any changes to it.

Learn more about Budget, here;

https://brainly.com/question/15683430

#SPJ2

Which of these are considered both short- and long-term investments? Select four options.
CDs
stocks
savings accounts
mutual funds
bonds
commodities

Edge answers please

Answers

Answer:

CDs

Stocks

Mutual funds

Commodities

Explanation:

:)

'Investments' are defined as the 'process of allocating money having an aim of receiving a profit.'

The items that can be considered as both the short, as well as, long-term investments would be:

A). CDs

B). Stocks

C). Mutual funds

E). Commodities

A CD or Certificate of Deposit(CD) is characterized as both the 'short, as well as, long-term' investment because it provides interest and offers a lump-sum on its maturity. Stocks are also such an investment as it offers both intra-day trade and long-term holding options as well. Mutual funds are also a good option for generating both regular incomes in the short-term and big capital gain over a time period. Commodities like gold, crude oil, etc. also offer such an option as it is the item whose price keeps growing and thereby providing an opportunity to earn.

Thus, options A, B, C, and E are the correct answers.

Learn more about 'short-term investment' here:

brainly.com/question/16462918

On January 1, a company issued and sold a $399,000, 9%, 10-year bond payable, and received proceeds of $394,000. Interest is payable each June 30 and December 31. The company uses the straight-line method to amortize the discount. The journal entry to record the first interest payment is:

Answers

Answer:

Cash Interest payable on Bond = $399,000*4.5% = $17,955

Discount to be amortized = ($399,000-$394,000)/20 = $250

Interest expense = $17,955+$250 = $18,205

Date   Journal Entry                                  Debit      Credit            

           Interest Expense                          $18,205

                 Discount on bonds payable                    $250

                 Cash                                                          $17,955

MAD Inc. has a capital structure consisting of 40 percent debt and 60 percent common equity financing. The company has $400 million in net income and plans to pay out 25 percent of their earnings as dividends. What is the maximum amount of new financing that the company can raise without selling new common stock

Answers

Answer:

$500 million

Explanation:

Retained earnings = Income * (1 - Dividend payout percentage)

Retained earnings = $400 million * (1-0.25)

Retained earnings = $400 million * 0.75

Retained earnings = $300 million

Amount that can be raise without selling new stock: Retained earnings / % of equity financing in total capital

= $300 million / 60%

= $300 million / 0.60

= $500 million

Assume that Saudi Arabia has production possibilities to produce either 100 barrels of oil using 100 worker hours or 25 bushels of corn using 100 worker hours. If it decides to produce 60 barrels of oil, how many bushels of corn can it produce

Answers

Answer: 10 bushels

Explanation:

If they produce 100 barrels of oil using 100 worker hours, it means that the number of work hours taken for 1 barrel is:

= 100 / 100

= 1 work hour

For bushels however, 1 worker hour produces:

= 25 / 100

= 0.25 bushels of corn

If 60 barrels of oil are produced, it means 60 worker hours were used which would leave 40 worker hours.

Bushels of corn produced is therefore:

= 40 * 0.25

= 10 bushels

Other Questions
WILLGIVE BRAINKISTHISTORYNEED RNBbb How do I answer this question I need help What is the BEST revision of this sentence?Wetlands used to be thought of as horrible places and now people realize wetlands are homes for animals like birds and wetlands are important for the environment. whats 7 times 8 divided by 2 i think the answer s 6 am i right or ring please tell me Melissa built a square pyramid out of sand. The base of the pyramid has a side length of 18 centimeters. The height of the pyramid is 26centimeters.What is the volume of the pyramid?A. 624 cm3B. 1,872 cmC. 2, 808 cmD. 4,212 cmE. 8, 424 cm Explain what cardiovascular exercise is in your own words. Explain the benefits of it and how it is different than muscular strength. Give 3 examples of cardiovascular exercises/activities What are the two limitations of earth plates A) The three levels of biodiversity are genetic diversity, species diversity, and ecosystem diversity. Explain the three levels ofbiodiversity and the concerns associated with loss of diversity at each level.B) Species and genetic diversity can be very beneficial to humans. Describe three ecosystem services that nature provides tohumans. Which ones the right answer? Once in an organism, what are these atoms used for? 1.On field day, the P.E. coach divides the students into two groups, Positives and Negatives. He wants to have the same amount of students of each group on each side of a rope, to play Tug-of-War. He uses the following expression to figure out how many students of a certain group he still needs to create an even match.5 + 20Evaluate the expression and write the answer below. Write only a number, either positive or negative. No letters Given the function f(x) = 4^x - 1, explain and show how to find the average rate of change between x = 1 and x = 4. Write an exponential function in the form y=b^x that goes through the points (0,9) and (3,4608) a 20 A fuse is connected in series with a circuit containing a 240 V source. What is the minimum resistance required to prevent the fuse from melting Gerardo makes $18 per hour at Starbucks. Tomorrow he is going to receive a raise totalling 20% of his hourly wage. What will he be making per hour straying tomorrow. what is the botanical name of milk Question 1 of 3Multiple ChoiceHow do cyber communities differ from communities in the real world with regard to safe behavior? A. It can be more difficult to identify unsafe behavior in a cyber community. B. They are not different in any important ways. C. People usually behave more safely online than offline. D. Communities in the real world are always safer. The Ballantyne area has 200 people over the age of eighty-five living in it of these people, 56 of them have a dog, 24 of them have a cat, and 16 of them have both of a personis chosen at random, find the probability that they have a cat, if it is known they have a dog.a. 1/2b.3/7c.2/7d.2/25 The Nazis looked at Jews as thisinstead of a religion In a survey of 554 U.S. adults, it is found that 360 favor a ban on stem cell research. Set up the null and the alternative hypotheses to test whether there is sufficient evidence that over 61% favor a ban on stem cell research. If alpha is set to 3.0%, should the null hypothesis be rejected