Podcast
Questions and Answers
What is the minimum IRR required for a project to be acceptable?
What is the minimum IRR required for a project to be acceptable?
- Equal to the firm’s cost of capital
- Twice the firm’s cost of capital
- Greater than the firm’s cost of capital (correct)
- Less than the firm’s cost of capital
What is the expected annual earnings before depreciation and taxes of the new milling machine?
What is the expected annual earnings before depreciation and taxes of the new milling machine?
- Tk.2,50,000
- Tk.2,00,000 (correct)
- Tk.1,00,000
- Tk.1,50,000
What is the cost of capital for Khaleque's company?
What is the cost of capital for Khaleque's company?
- 14%
- 16%
- 10%
- 12% (correct)
What is the expected annual reduction in labor costs due to the new machine for the plastic manufacturing company?
What is the expected annual reduction in labor costs due to the new machine for the plastic manufacturing company?
What is the primary focus of capital budgeting in a firm?
What is the primary focus of capital budgeting in a firm?
What is the required after-tax return on investment for the plastic manufacturing company?
What is the required after-tax return on investment for the plastic manufacturing company?
What is the payback period in capital budgeting?
What is the payback period in capital budgeting?
What is the purpose of capital budgeting in a firm?
What is the purpose of capital budgeting in a firm?
What is the term 'capital' referring to in capital budgeting?
What is the term 'capital' referring to in capital budgeting?
How is the payback period calculated in capital budgeting?
How is the payback period calculated in capital budgeting?
What is the primary decision rule for the Payback Period Method?
What is the primary decision rule for the Payback Period Method?
What is the major limitation of the Payback Period Method?
What is the major limitation of the Payback Period Method?
What is the purpose of the Payback Period Method?
What is the purpose of the Payback Period Method?
What is the formula to calculate the exact period of the Payback Period?
What is the formula to calculate the exact period of the Payback Period?
What is the result of the Payback Period calculation for Project A?
What is the result of the Payback Period calculation for Project A?
What is the primary advantage of discounted payback period over ordinary payback period?
What is the primary advantage of discounted payback period over ordinary payback period?
What is the main drawback of the discounted payback period rule?
What is the main drawback of the discounted payback period rule?
What is the primary goal of the capital budgeting process?
What is the primary goal of the capital budgeting process?
What does a positive net present value (NPV) indicate?
What does a positive net present value (NPV) indicate?
What is the discounted payback period a measure of?
What is the discounted payback period a measure of?
What does an NPV of zero signify about a project's cash flow?
What does an NPV of zero signify about a project's cash flow?
What is the decision criterion for NPV?
What is the decision criterion for NPV?
What does the rate of return 'k' represent in the NPV equation?
What does the rate of return 'k' represent in the NPV equation?
What is the effect on a firm's value if a project has a positive NPV?
What is the effect on a firm's value if a project has a positive NPV?
What is the purpose of using NPV in capital budgeting?
What is the purpose of using NPV in capital budgeting?
What is the primary goal of financial appraisal in a project?
What is the primary goal of financial appraisal in a project?
Which of the following is NOT a part of financial appraisal?
Which of the following is NOT a part of financial appraisal?
What is the purpose of finding the IRR in capital budgeting?
What is the purpose of finding the IRR in capital budgeting?
What is the purpose of sensitivity analysis in financial appraisal?
What is the purpose of sensitivity analysis in financial appraisal?
What is the discount rate that makes the NPV of a project equal to zero?
What is the discount rate that makes the NPV of a project equal to zero?
What is an important consideration in evaluating the financial viability of a project?
What is an important consideration in evaluating the financial viability of a project?
If the IRR of a project is 15%, and the cost of capital is 12%, what should the firm do?
If the IRR of a project is 15%, and the cost of capital is 12%, what should the firm do?
What is the formula to calculate the IRR using the trial and error method?
What is the formula to calculate the IRR using the trial and error method?
Which of the following is a key aspect of capital budgeting techniques?
Which of the following is a key aspect of capital budgeting techniques?
What is the decision criterion if the IRR is equal to the cost of capital?
What is the decision criterion if the IRR is equal to the cost of capital?
What is the primary focus of socio-economic appraisal?
What is the primary focus of socio-economic appraisal?
What is a key consideration in evaluating a project's financial viability?
What is a key consideration in evaluating a project's financial viability?
What is the purpose of preparing projected financial statements?
What is the purpose of preparing projected financial statements?
What is an important aspect of financial appraisal in infrastructure projects?
What is an important aspect of financial appraisal in infrastructure projects?
What is a key consideration in evaluating a project's financing?
What is a key consideration in evaluating a project's financing?