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    NEW QUESTION: 1
    International Transport Company is considering building a new facility in Seattle. If the company goes ahead with the project, it will spend $2 million immediately (at t = 0) and another $2 million at the end of Year 1 (t = 1). It will then receive net cash flows of $1 million at the end of Years 2 - 5, and it expects to sell the property for $2 million at the end of Year 6. The company's cost of capital is 12 percent, and it uses the modified IRR criterion for capital budgeting decisions. Which of the following statements is most correct?
    A. The regular IRR is less than the cost of capital. Under this condition, the modified IRR will also be less than the regular IRR.
    B. Given the data in the problem, the modified IRR criterion indicates that the project should be accepted.
    However, the NPV is negative. This demonstrates that the modified IRR criterion is not always a valid decision method for projects such as this one.
    C. If the regular IRR is less than the cost of capital, then the modified IRR will be greater than the regular IRR. That situation applies in this case.
    D. The project should be accepted because the modified IRR is greater than the cost of capital.
    E. The project should be rejected because the modified IRR is less than the regular IRR.
    Answer: C
    Explanation:
    Explanation/Reference:
    Explanation:
    PV(Outflows) = -$2,000,000 - $2,000,000/1.12 = -$3,785,714.
    TV(Inflows) = $1,000,000(FVIFA(12%,4))(1.12) + $2,000,000
    = $1,000,000(4.7793)(1.12) + $2,000,000 = $7,352,816.
    1 + MIRR = [7,352,816/3,785,714]

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    1/6; MIRR = 11.7%.
    Since the MIRR is less than the cost of capital, the IRR is less than the MIRR.

    NEW QUESTION: 2
    Which rate determines when an economy will experience wage-push inflationary pressures?
    A. The non-accelerating inflation rate of unemployment.
    B. CPI-based inflation rate.
    C. The actual unemployment rate.
    Answer: A
    Explanation:
    The NAIRU determines when an economy will experience bottlenecks in the labor market.

    NEW QUESTION: 3
    DRAG DROP
    You need to call the DoWork() method asynchronously in a background task.
    Which four lines of code should you use to create the Run() method on line SP13? (To
    answer, move the appropriate lines of code from the list of code segments to the answer area and arrange them in the correct order.)

    Answer:
    Explanation:


    NEW QUESTION: 4
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