Which one of the following methods of analysis ignores the time value of money? Net present...
Which one of the following methods of analysis ignores the time value of money?
Net present value
Internal rate of return
Discounted cash flow analysis
Payback
Profitability index
Homework Answers
Payback period ignores the time value of money - this is the disadvantage of payback period.
The method does not take into account the time value of money, where cash generated in later periods is work less than cash earned in the current period. A variation on the payback period formula, known as the discounted payback formula, eliminates this concern by incorporating the time value of money into the calculation.
Add Answer to:
Which one of the following methods of analysis ignores the time
value of money?
Net present...
Which of the following methods of project analysis are biased towards short-term projects? O Payback and...
Which of the following methods of project analysis are biased towards short-term projects? O Payback and profitability index O Profitability index and internal rate of return O Discounted payback and payback O Profitability index and discounted payback O Net present value and payback
The payback method of analysis ignores which one of the following? 1. Time value of money...
The payback method of analysis ignores which one of the following? 1. Time value of money 2. Arbitrary cutoff point 3. Cash flow direction 4. Timing of each cash inflow 5. Initial cost of an investment
The conventional payback period ignores the time value of money, and this concems Blue Hamster's CFO....
The conventional payback period ignores the time value of money, and this concems Blue Hamster's CFO. He has now asked you to compute Delta's discounted payback period, assuming the company has a 10% cost of capital. Complete the following table and perform any necessary calculations. Round the discounted cash flow values to the nearest whole dollar, and the discounted payback period to two decimal places. For full credit, complete the entire table. (Note: If your answer is negative, be sure...
The conventional payback period ignores the time value of money, and this concerns Blue Hamster's CFO. He has now a...
The conventional payback period ignores the time value of money, and this concerns Blue Hamster's CFO. He has now asked you to compute Delta's discounted payback period, assuming the company has a 8% cost of capital. Complete the following table and perform any necessary calculations. Round the discounted cash flow values to the nearest whole dollar, and the discounted payback period to the nearest two decimal places. For full credit, complete the entire table. Year 0 -5,500,000 Year 1 $2,200,000...
The net present value method assumes that cash flows are reinvested at the ____. Whereas the...
The net present value method assumes that cash flows are reinvested at the ____. Whereas the internal rate of return method assumes that cash flows are reinvested at the____. discount rate, required rate of return cost of capital, market rate of return firm’s cost of capital, computed internal rate of return marginal cost of capital , discount rate. In terms of the capital budgeting process, the dollar amount of interest charges is always considered in the net cash flow calculation...
The conventional payback period ignores the time value of money, and this concems Blue Hamster's CFO. He has now asked...
The conventional payback period ignores the time value of money, and this concems Blue Hamster's CFO. He has now asked you to compute Delta's discounted payback period, assuming the company has a 10% cost of capital. Complete the following table and perform any necessary calculations. Round the discounted cash flow values to the nearest whole dollar, and the discounted payback period to two decimal places. For full credit, complete the entire table. (Note: If your answer is negative, be sure...
Which of the following methods does not involve an interest rate from any source? Payback period...
Which of the following methods does not involve an interest rate from any source? Payback period O Profitability index Net present value O Internal rate of return Discounted payback
1. Which of the following capital investment evaluation methods use present values? A. Net present value...
1. Which of the following capital investment evaluation methods use present values? A. Net present value method B.Average rate of return method C. Both "Net present value method" and "Average rate of return method" D. Neither "Net present value method" nor "Average rate of return method" 2. A common characteristic found in capital investment evaluation methods that use present values is ________. no interest rate an interest rate their ease of use None of these choices are correct. 3. Assume that...
Which of the following capital budgeting techniques consider the cost of capital? (1) Net Present Value...
Which of the following capital budgeting techniques consider the cost of capital? (1) Net Present Value (2) Internal Rate of Return (3) Profitability Index (4) Payback Period (5) Discounted Payback Period Options: 1) and (2) (1) (1) and (2) and (3) (1) and (2) and (3) and (5)
Which capital budgeting metric does not account for time value of money? Group of answer choices...
Which capital budgeting metric does not account for time value of money? Group of answer choices Internal rate of return (IRR). Net present value (NPV). Profitability Index. Payback period. All of these incorporate time value of money in their calculation. PreviousNext
Which of the following methods of project analysis are biased towards short-term projects? O Payback and profitability index O Profitability index and internal rate of return O Discounted payback and payback O Profitability index and discounted payback O Net present value and payback
The conventional payback period ignores the time value of money, and this concems Blue Hamster's CFO. He has now asked you to compute Delta's discounted payback period, assuming the company has a 10% cost of capital. Complete the following table and perform any necessary calculations. Round the discounted cash flow values to the nearest whole dollar, and the discounted payback period to two decimal places. For full credit, complete the entire table. (Note: If your answer is negative, be sure...
The conventional payback period ignores the time value of money, and this concerns Blue Hamster's CFO. He has now asked you to compute Delta's discounted payback period, assuming the company has a 8% cost of capital. Complete the following table and perform any necessary calculations. Round the discounted cash flow values to the nearest whole dollar, and the discounted payback period to the nearest two decimal places. For full credit, complete the entire table. Year 0 -5,500,000 Year 1 $2,200,000...
The conventional payback period ignores the time value of money, and this concems Blue Hamster's CFO. He has now asked you to compute Delta's discounted payback period, assuming the company has a 10% cost of capital. Complete the following table and perform any necessary calculations. Round the discounted cash flow values to the nearest whole dollar, and the discounted payback period to two decimal places. For full credit, complete the entire table. (Note: If your answer is negative, be sure...
Which of the following methods does not involve an interest rate from any source? Payback period O Profitability index Net present value O Internal rate of return Discounted payback
Most questions answered within 3 hours.
-
Where is the error in this code sequence?
String s1 = "Hello";
String s2 = "ello";...
asked 11 months ago -
Financial data for Joel de Paris, Inc., for last year
follow:
Joel de Paris, Inc.
Balance...
asked 11 months ago -
Consider this reaction:
Al2(SO4)3 (aq)+ BaCl3
(aq) Al2Cl6 (aq)- +
3BaSO4(s) . What is the...
asked 11 months ago -
Suppose that Savneet is considering increasing her
recent random sample from 20 car rentals to 40...
asked 11 months ago -
Trucks arrive at an unloading terminal at an average rate of 120
per hour.
Trucks arrive...
asked 11 months ago -
Why are methanol and ethanol completely soluble in water while
octanol is not very little soluble....
asked 11 months ago -
A facilities manager at a university reads in a research report
that the mean amount of...
asked 11 months ago -
When the CuSO4 is rehydrated by adding water to the anhydrous
compound, is this an endothermic...
asked 11 months ago -
A ray of sunlight is passing from diamond into crown glass; the
angle of incidence is...
asked 11 months ago -
A block of mass 0.249 kg is placed on top of a light, vertical
spring of...
asked 11 months ago -
how do the kidneys compensate in the presences of acidosis
a) trigger hyperventilate
b) reserve acid...
asked 11 months ago -
Question 501 pts
The rental rate of capital to the firm increases. Which of the
following...
asked 11 months ago