question archive To account for value of cheap financing in a capital project, one should: a
To account for value of cheap financing in a capital project, one should: a
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To account for value of cheap financing in a capital project, one should:
a. add the percentage savings to the project's IRR.
b. compare cost of borrowing for the cheap financing with the cost of borrowing in the same country where the cheap financing comes from.
c. compare the cost of borrowing for the cheap financing with the cost of borrowing in the country where the project is.
d. All of the above.
e. None of the above.
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The correct answer is option d.
Step-by-step explanation
All of the options are correct for accounting the value of cheap financing in a capital project.
Option d is the correct answer.
One should add the saving to the project's IRR and also compare it with home country and also in the country where the project is.
