University of New Brunswick

CE 3963

1.
Suppose that cash flows of a project are given as follows
Year Costs, $$ Savings, $$
0 100,000 0.0
1 20,000 60,000
2 20,000 70,000
3 20,000 80,000
4 20,000 90,000
It is known that the MARR is 10%. What is the payback period of the project?
Possible Answers
A. One year
B. Two years
C. Three years
D. Four years
E. The project does not pay back
Score: 0/0.5
2.
For two mutually exclusive projects with unequal lives, the one with
Possible Answers
A. a higher IRR should be chosen
B. a higher PW at the MARR should be chosen (PPT 5-14)
C. a higher FW at the MARR should be chosen
D. a higher incremental IRR should be chosen
E. a higher incremental AW at the MARR should be chosen
Score: 0.5/0.5
3.
One of major drawbacks of the inventory-turnover ratio is
Possible Answers
A. Inventories are an across variable while sales are a through variable
This study source was downloaded by 100000870261864 from CourseHero.com on 08-26-2023 14:52:16 GMT -05:00
https://www.coursehero.com/file/31282304/Midterm-2010docx/
Possible Answers
B. Inventories are a through variable while sales are an across variable
C. Sales are measured at costs while inventories are measured at market prices
D. It includes only quick assets
E. It includes only current liabilities
Score: 0/0.5
4.
For two mutually exclusive projects with unequal lives, the one with
Possible Answers
A. a higher PW at the MARR should be chosen
B. a higher AW at the MARR should be chosen
C. a higher FW at the MARR should be chosen
D. a higher incremental PW at the MARR should be chosen
E. a higher incremental AW at the MARR should be chosen
Score: 0/0.5
5.
For an independent project to be accepted
Possible Answers
A. the PW of the project evaluated at MARR should be positive
B. the PW of the project evaluated at MARR should be equal to zero
C. the PW of the project evaluated at MARR should be equal or greater than zero
D. should be positive at the market interest rate
E. should be equal to zero at the market interest rate
Score: 0.5/0.5
6.
What is the depreciation rate using declining-balance for an asset costing $150,000 that has
a salvage value of $25,000 after 10 years?