Financial Management-Capital Budgeting Decisions- Risk Analysis (CBSE-NET (UGC) Management (Paper-II & Paper-III)): Questions 4 - 5 of 5

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Question number: 4

» Financial Management » Capital Budgeting Decisions- Risk Analysis

Appeared in Year: 2015

MCQ▾

Question

Statement-I: In general, the NPV and IRR methods lead to the same acceptance or rejection decision, when a single project is involved.

Statement-II: The inconsistency in ranking of competing projects as per the NPV and IRR methods lies in the implicit assumptions with regard of different rates of returns on re-investment of intermediate cash flows.

Choices

Choice (4) Response

a.

Statement-I is incorrect, statement-II is correct

b.

The statements I and statement II are correct

c.

Statement-I is correct, statement II is incorrect

d.

The statements I and statement II are incorrect

Question number: 5

» Financial Management » Capital Budgeting Decisions- Risk Analysis

MCQ▾

Question

A project whose cash flows are more than capital invested for rate of return then net present value will be

Choices

Choice (4) Response

a.

Positive

b.

Zero

c.

Independent

d.

Negative

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