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Author Question: The advantages of NPV are all of the following EXCEPT A) it recognizes the timing of the benefits ... (Read 51 times)

audragclark

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on: Jul 10, 2018
The advantages of NPV are all of the following EXCEPT
 
  A) it recognizes the timing of the benefits resulting from the project.
  B) it can be used as a rough screening device to eliminate those projects whose returns do not
  materialize until later years.
  C) it allows the comparison of benefits and costs in a logical manner through the use of time
  value of money principles.
  D) it provides the amount by which positive NPV projects will increase the value of the firm.

Question 2

Mix Sweet Shop bakes and sells pies. Mix has annual fixed costs of 880,000 and a variable cost per
  pie of 7.50. Each pie sells for 15.50 each. The firm expects to sell 500,000 pies annually. What is
  the break-even point in pies?
 
  A) 190,440 B) 200,000 C) 280,000 D) 110,000
Foundations of Finance ¦ Keown, Petty, Martin ¦ 9th Edition
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juwms

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Reply #1 on: Jul 10, 2018
Answer to Question 1

B

Answer to Question 2

D


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