【正文】 oject is a project whose:a. acceptance or rejection has no effect on other projects. b. NPV is always negative. c. IRR is always negative. d. acceptance or rejection affects other projects. e. cash flow pattern exhibits more than one sign change. Difficulty level: EasyINTERNAL RATE OF RETURNd 57. A project will have more than one IRR if:a. the IRR is positive. b. the IRR is negative. c. the NPV is zero. d. the cash flow pattern exhibits more than one sign change. e. the cash flow pattern exhibits exactly one sign change. Difficulty level: EasyINTERNAL RATE OF RETURN RULESb 58. Using internal rate of return, a conventional project should be accepted if the internal rate of return is:a. equal to the discount rate. b. greater than the discount rate. c. less than the discount rate. d. negative. e. positive. Difficulty level: EasyINTERNAL RATE OF RETURNa 59. The internal rate of return may be defined as:a. the discount rate that makes the NPV cash flows equal to zero. b. the difference between the market rate of interest and the NPV. c. the market rate of interest less the riskfree rate. d. the project acceptance rate set by management. e. None of the above. Difficulty level: MediumMULTIPLE INTERNAL RATE OF RETURNSd 60. The problem of multiple IRRs can occur when:a. there is only one sign change in the cash flows. b. the first cash flow is always positive. c. the cash flows decline over the life of the project. d. there is more than one sign change in the cash flows. e. None of the above. Difficulty level: EasyTIMING AND SCALE ISSUES WITH INTERNAL RATE OF RETURNb 61. The elements that cause problems with the use of the IRR in projects that are mutually exclusive are:a. the discount rate and scale problems. b. timing and scale problems. c. the discount rate and timing problems. d. scale and reversing flow problems. e. timing and reversing flow problems. Difficulty level: MediumNET PRESENT VALUE DECISIONc 62. If there is a conflict between mutually exclusive projects due to the IRR, one should:a. drop the two projects immediately. b. spend more money on gathering information. c. depend on the NPV as it will always provide the most value. d. depend on the AAR because it does not suffer from these same problems. e. None of the above. Difficulty level: MediumPROFITABILITY INDEXe 63. The profitability index is the ratio of:a. average ine to average investment. b. internal rate of return to current market interest rate. c. present value of cash flows to internal rate of return. d. present value of cash flows to average accounting return. e. present value of cash flows to initial investment cost. Difficulty level: EasyINVESTMENT DECISION RULESa 64. Which of the following statement is true? a. One must know the discount rate to pute the NPV of a project but one can pute the IRR without referring to the discount rate. b. One must know the discount rate to pute the IRR of a project but one can pute the NPV without referring to the discount rate. c. Payback accounts for time value of money. d. There will always be one IRR regardless of cash flows. e. Average accounting return is the ratio of total assets to total ine. Difficulty level: MediumCAPITAL BUDGETING PRACTICEb 65. Graham and Harvey (2022) found that ___ and ___ were the two most popular capital budgeting methods. a. Internal Rate of Return。 Payback Period b. Internal Rate of Return。 Net Present Value c. Net Present Value。 Payback Period d. Modified Internal Rate of Return。 Internal Rate of Return e. Modified Internal Rate of Return。 Net Present Value Difficulty level: MediumIII. PROBLEMSNET PRESENT VALUEb 66. What is the present value of a project with the following cash flows and a required return of 12 percent?Year Cash Flow 0 $28,900 1 $12,450 2 $19,630 3 $ 2,750a. $b. $c. $d. $e. $Difficulty level: EasyNET PRESENT VALUEa 67. What is the present value of a project that has an initial cash outflow of $12,670 and the following cash inflows? The required return is percent.Year Cash Inflows 1 $4,375 2 $ 0 3 $8,750 4 $4,100a. $b. $c. $d. $1,e. $1,Difficulty level: EasyNET PRESENT VALUEb 68. A project will produce cash inflows of $1,750 a year for four years. The project initially costs $10,600 to get started. In year five, the project will be closed and as a result should produce a cash inflow of $8,500. What is the present value of this project if the required rate of return is percent?a. $5,b. $1,c. $d. $1,e. $5,Difficulty level: EasyNET PRESENT VALUEa 69. You are considering the following two mutually exclusive projects that will not be repeated. The required rate of return is percent for project A and percent for project B. Which project should you accept and why?Year Project A Project B 0 $48,000 $126,900 1 $18,400 $ 69,700 2 $31,300 $ 80,900 3 $11,700 $ 0a. project A。 because its NPV is about $335 more than the NPV of project Bb. project A。 because it has the higher required rate of returnc. project B。 because it has the largest total cash inflowd. project B。 because it returns all its cash flows within two yearse. project B。 because it is the largest sized projectDifficulty level: MediumNET PRESENT VALUEa 70. You are considering two mutually exclusive projects with the following cash flows. Will your choice between the two projects differ if the required rate of return is 8 percent rather than 11 percent? If so, what should you do?Year Project A Project B 0 $240,000 $198,000 1 $ 0 $110,800 2 $ 0 $ 82,500 3 $325,000 $ 45,000a. yes。 Select A at 8 percent and B at 11 percent.b. yes。 Select B at 8 percent and A at 11 p