Quiz - Capital Budgeting

If the initial investment is RM10,000 and the annual return is RM2,500, what is the payback period?

• 2 years

• 3 years

• 4 years

• 5 years

A project has cash inflows of RM3,000 annually for 5 years. If the initial investment is RM12,000, what is the payback period?

• 3 years

• 4 years

• 5 years

• 6 years

If a project requires RM8,000 and returns RM2,000 annually, what is the payback period?

• 3 years

• 4 years

• 5 years

• 6 years

NPV of a project with RM5,000 inflow per year for 3 years, initial investment RM12,000, discount rate 10%. Approximate NPV?

• RM1,500

• RM500

• RM0

• -RM500

ARR: If average annual profit = RM4,000, and investment = RM20,000, ARR = ?

• 10%

• 15%

• 20%

• 25%

Discounted cash flow of RM1,000 one year from now at 10% rate is?

• RM900

• RM909

• RM950

• RM990

Initial investment: RM10,000, cash inflows: RM3,000/year for 4 years, NPV at 0% discount rate is?

• RM2,000

• RM12,000

• RM10,000

• RM3,000

If a project returns RM1,200 annually for 5 years and initial cost is RM5,000, what is total return?

• RM5,000

• RM6,000

• RM6,200

• RM7,000

A project costs RM15,000 and generates RM5,000 per year for 3 years. What is the NPV at 0% rate?

• RM0

• RM1,000

• RM2,000

• No profit

If the present value of inflows is RM20,000 and cost is RM18,000, what is the NPV?

• RM1,000

• RM2,000

• RM3,000

• RM5,000