Princips of Corporate Finance 英文第十版习题解答Chap005.docVIP

CHAPTER 5 Net Present Value and Other Investment Criteria Answers to Problem Sets 1. a. A = 3 years, B = 2 years, C = 3 years b. B c. A, B, and C d. B and C (NPVB?=?$3,378; NPVC?= $2,405) e. True f. It will accept no negative-NPV projects but will turn down some with positive NPVs. A project can have positive NPV if all future cash flows are considered but still do not meet the stated cutoff period. 2. Given the cash flows C0, C1, . . . , CT, IRR is defined by: It is calculated by trial and error, by financial calculators