If we apply the discounted payback decision rule to all projects, it will likely lead to...

If we apply the discounted payback decision rule to all projects, it will likely lead to ________________________.

some positive net present value projects to be rejected
the most liquid projects to be rejected in favor of the less liquid projects
projects to be incorrectly accepted due to ignoring the time value of money
a firm to become more long-term focused
some projects to be accepted which would otherwise be rejected under the payback rule

__________ is the best example of two mutually exclusive projects from below.

Building a furniture store beside a clothing outlet in the same shopping mall
Producing both plastic forks and spoons on the same assembly line
Using an empty warehouse to store both raw materials and finished goods
Promoting two products during the same television commercial
Waiting until a machine finishes molding Product A before being able to mold Product B

FoodMart has analyzed a new store project and determined that the project's internal rate of return is lower than the firm desires. The project's internal rate of return can be increase by _______________of the project.

decreasing the required discount rate
increasing the initial investment in fixed assets
condensing the firm's cash inflows into fewer years without lowering the total amount of those inflows
eliminating the salvage value
decreasing the amount of the final cash inflow

Expert Solution

jeff jeffy answered 1 year ago

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