Quiz 1 covers chapter 1 and 3

1. Given the following cash flows for project A: C0 = -$2,000, C1 = $2,000 , C2 = +$1,500 and C3 = $1,000, calculate the payback period. A) One year . B) 2 years . C) 3 years . D) None of the above . Answer : A. 2. The IRR is defined as: A) The discount rate that makes the present value of future cash flows same as the initial (time zero ... ................
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