The period of time
within which an investment made for a project is recovered by the cash inflows
of the project is known as the
O A. Period of return.
O B. Payback period.
O C. Discounted cashflow
period.
O D. Period of gain.
QUESTION 8
If stock prices follow a sub martingale
process, we would expect returns on average to be
O A. Positive.
O B. Negative.
O C. Zero.
O D. Equal to the
risk-free rate.
The Internal Rate of
Return (IRR) criterion for project acceptance, under theoretically infinite
funds, is to accept all projects which have
O A. IRR equal to the cost
of capital.
B. IRR greater than the
cost of capital.
C. IRR less than the
cost of capital. O
D.IRR equal to zero.
QUESTION 10
A project may be
regarded as high risk when
O A. It has smaller
variance of outcome and a high initial investment.
O B. It has larger
variance of outcome and high initial investment.
O C. It has smaller
variance of outcome and a low initial investment.
D. It has larger
variance of outcome and low initial investment.
