1. Using a prime rate of 3.75% and short term debt in the amount of $9,832 (Tax rate if needed is 32.70%)
Calculate the cost of short term debt.
2. When evaluating a project, a manager should always first consider the IRR as the main decision criteria (if yes, explain why, if no, explain why not or give counter example).
True or False. Explain your answer.
3. The stand-alone principle refers to the financial manager's personal responsibility for the outcome of a capital budgeting decision.
True or False - Explain your answer.