Problem: Suppose a risk less project requires an initial investment of $10 and will generate a one-time cash inflow of $30 two years later. Assuming a risk-free interest rate of 5%, which of the following statements about the project is FALSE?
1. The net present value of the project is positive
2. The IRR is greater then 50 percent
3. The accounting rate of return on the project is positive.
4. The payback period is less than 2 years