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1. The net present value (NPV) capital budgeting decision method: can be directly compared between alternatives incorporates the time value of money in the calculations is based on accounting net income indicates an acceptable capital project with a negative value2. On a capital project a net present value of ($250): indicates the capital project s rate of return exceeds the company s cost of capital for one project is considered superior to another project with a net present value of $500 indicates the internal rate of return would be unacceptable indicates cash outflows total $250 for the capital project3. A 13% internal rate of return (IRR) on a capital project indicates all of the following except: the actual rate of return of all cash inflows and outflows that a 13% discount rate will result in the calculation of a net present value of zero a better indication of acceptable capital projects when there is limited capital than the net present value method an acceptable capital project if the cost of capital is 14%4. Which of the following indicates an unacceptable capital projectThe internal rate of return exceeds the cost of capital.The net present value of a project is 10.The profitability index of a project is 0.97.The accounting rate of return exceeds the target rate of return.

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