# NPTEL Project Management Week 6 Assignment Answers

NPTEL Project Management Week 6 Assignment Answers:- In this post, we have provided the answers to the NPTEL Project Management Week 6

## NPTEL Project Management Week 6 Assignment Answers 2022

Q1. Which of the following is one of the assumptions of PERT?

`Answer:- Total project completion time follows a normal probability distribution.`
Q2. In a PERT network, the earliest (activity) start time is the:

`Answer:- earliest time that an activity can start without violation of precedence requirements.`
Q3. The time by which activity completion time can be delayed without affecting the start of succeeding activities, is known as:

`Answer:- Free float`
Q4. Discount rate which forces net present values to become zero is classified as

`Answer:- internal rate of return`
Q5. The discount factor used to appraise capital investment decisions is a measure of:

`Answer:- The opportunity cost of capital of the business`
Q6. Which of the following statements concerning the payback period, is not true?

`Answer:- It takes account of the time value of money.`
Q7. NPTEL Ltd is considering two possible projects but can only raise enough funds to proceed with one of them. Investment appraisal techniques have been used and the following results found:
Which of the following is the most logical interpretation of the results?

`Answer:- Project W should be selected because it will yield the highest NPV.`
Q8. NPTEL Ltd is considering undertaking a project, which will involve an initial outlay of £300,000. The project has the following cash flows associated with it:
If a discount rate of 10% is used to calculate the NPV of the project, which of the following statements is correct? (Assume the cash flows arise at the end of each year.)

`Answer:- The project will yield a positive NPV of £65.5k and have a payback period of 2 years and 3 months.`
Q9. Tata Industry is considering a new project that develops a new iron pigment, PRISTINE. The company has estimated that the project’s NPV is Rs.3 million, but this does not consider that the new pigment will reduce the revenues received on its existing pigment products. Specifically, the company estimates that if it develops PRISTINE the company will lose Rs. 500,000 in after-tax cash flows during each of the next 10 years because of the cannibalization of its existing products. Tata Industry’s WACC is 10 percent. What is the net present value (NPV) of undertaking PRISTINE after considering externalities?

`Answer:- Rs. (-72,283.55)`
Q10. NPTEL Ltd. is considering two mutually exclusive projects. Project A has an internal rate of return (IRR) of 12 percent, while Project B has an IRR of 14 percent. The two projects have the same risk, and when the cost of capital is 7 percent the projects have the same net present value (NPV). Assume each project has an initial cash outflow followed by a series of inflows. Given this information, which of the following statements is most correct?

`Answer:- All of the statements above are correct.`