A project earns $10,000 a year for five years. The present total value of the project...

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Finance

A project earns $10,000 a year for five years. The present totalvalue of the project is (using a discount rate of 5.75%):
a) $50,000
b) more than $50,000
c) less than $50,000
The NPV of a project is $1,012, using a discount rate of 9.75%p.a. The rate of return on this project is:
a) 9.75%
b) more than 9.75% c) less than 9.75%
The NPV of a project is 0, using a discount rate of 10%. Therate of return on this project is:
a) 10%
b) more than 10%
c) lessthan10%
A machine has a salvage value of $5,000. Using a discount rateof 5% p.a., the present value of the salvage value is:
a) $5,000
b) more than $5,000 c) lessthan$5,000
The capital cost of a project that lasts for five years is$50,000. Using a discount rate of 2.95%, the annual worth of thecapital cost is:
a) $10,000
b) more than $10,000
c) lessthan$10,000
A machine has a salvage value of $5,000 after five years. Usinga discount rate of 2.95% p.a., the annual worth of the salvagevalue is:
a) $1,000
b) more than $1,000
c) lessthan$1,000
The NAW of a project is 0, using a discount rate of 6%. The rateof return on this project is:
a) 6%
b) more than 6%
c) lessthan6%

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4.1 Ratings (633 Votes)

Answer to Question 1 less than 50000 Annual Cash Inflow 10000 Period 5 years Discount Rate 575 Present Value 1000010575 10000105752 10000105753 10000105754 10000105755 Present Value 10000 1 1105755 00575 Present See Answer

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Transcribed Image Text

A project earns $10,000 a year for five years. The present totalvalue of the project is (using a discount rate of 5.75%):a) $50,000b) more than $50,000c) less than $50,000The NPV of a project is $1,012, using a discount rate of 9.75%p.a. The rate of return on this project is:a) 9.75%b) more than 9.75% c) less than 9.75%The NPV of a project is 0, using a discount rate of 10%. Therate of return on this project is:a) 10%b) more than 10%c) lessthan10%A machine has a salvage value of $5,000. Using a discount rateof 5% p.a., the present value of the salvage value is:a) $5,000b) more than $5,000 c) lessthan$5,000The capital cost of a project that lasts for five years is$50,000. Using a discount rate of 2.95%, the annual worth of thecapital cost is:a) $10,000b) more than $10,000c) lessthan$10,000A machine has a salvage value of $5,000 after five years. Usinga discount rate of 2.95% p.a., the annual worth of the salvagevalue is:a) $1,000b) more than $1,000c) lessthan$1,000The NAW of a project is 0, using a discount rate of 6%. The rateof return on this project is:a) 6%b) more than 6%c) lessthan6%