Question
XYZ Ltd. is evaluating a project that requires an
initial investment of ₹10 crore. The expected cash inflows over the next 5 years are uneven. The company uses a discount rate of 10%. The project has a positive NPV of ₹1.5 crore, but the IRR is only marginally above the cost of capital. Meanwhile, another project offers a higher IRR but lower NPV. What should the company prioritize if it wants to maximize shareholder wealth?Solution
NPV directly reflects the value addition to the shareholders’ wealth. Even if IRR is higher for the other project, the project with higher NPV is preferred in value maximization.
If detA = 3, detB = 2, then det(AB) =?If sin x + sin 2x = 1 and cos x + cos 2x = 0, find x.
5, 24, 47, 76, 113, ?.
- What is a hierarchical, decentralized system used to name computers, services, or resources on the internet or private networks?
A group of 20 boys can complete a task in 15 days. Similarly, 24 girls can finish the same task in 20 days. If the ratio of the e...
27, 28, 30, 34, 42, ?
A circle with radius 5 units is inscribed in a square. What is the area of the square?
A and B initiated a business by investing Rs. 6,000 and Rs. 3,000, respectively. Their investments were made for 8 months and 'm'...
A basket contains 4 yellow balls, 10 green balls, and 6 white balls. If two balls are taken out one after another without putting the first one back, fi...
In the question, two equations I and II are given. You have to solve both the equations to establish the correct relation between x and y and choose the...
