1) if you believe the price of a stock is going to go lower you will purchase a call
- True or False
2) the IRR is the rate that
a – equals zero
b – makes the npv zero
c – would make the project acceptable
d – none of the above are correct.
3) the MIRR, when the NPV is positive
a – will be greater than the IRR
b – more information is needed
c – will be less than the IRR and greater than the v..
d – will be less than the WACC
4) The par value of a stock has no relation to the market price of that stock
True or False
5) A negative aspect of the IRR is
a – it assumes all cash flows are reinvested at the IRR to the end of the project.
B – when there is more than on change in signs (CF - + + - +) multiple IRR will…
C – both “a” and “b” are correct
D – neither “a” or “b” are correct
6) If the NPV of a project is positive then the project is acceptable and will definitely be completed
True or False
7) If two projects are mutually exclusive and acceptable, then
a – both may be completed
b – neither will be completed
c – only one of the projects will be completed
d – these projects have nothing to with production