Assignment 4 Finance

FIN1FOF – FUNDAMENTALS OF FINANCE SEMESTER 2, 2014

Assessment Task – Assignment 4

Submit at your tutorial class in week 9. Note: Late submission – Zero Mark.

Question One:

1. (a)  Define the Payback, the Accounting rate of return, and the Internal Rate of Return

   Methods. In your definition state the criteria for accepting or rejecting an investment under each rule. (30 marks)

2.  

   (b)  Discuss the advantages and disadvantages of the Payback and Accounting rate of return methods. (20 marks)

    

3. (c)  Discuss four problems (using examples) associated with the Internal Rate of Return Method. (50 marks)