Diane’s wages are $17,700 and she receives dividend income of $70
January 3, 2018
Assuming that their total tax on a child’s unearned income for 2016 is $2,400, allocate the total parental tax to Richard and Roberta
January 3, 2018

What are the primary types of real options in capital budgeting? Give examples of each type.

Finance Basics

  1. What effect would you expect the use of MACRS depreciation rules to have on the acceptability of a project having a 10-year economic life but a 7-year MACRS classification?

  2. What are the primary types of real options in capital budgeting? Give examples of each type.

  3. Calculate the net present value and profitability index of a project with a net investment of $20,000 and expected net cash inflows of $3,000 a year for 10 years if the project’s required return is 12 percent. Is the project acceptable?

 

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