FINC 3610 Final Dismukes All questions with
| | || | | || |
correct answers |
How |many |different |investment |criteria |did |we |review |in |the |module, |and |thus |you |are |responsible |
for |understanding? |- |✔✔7
An |investment |should |be |accepted |if |the |_____________________ |is |positive |and |rejected |if |it |is |
negative |- |✔✔NPV
Which |investment |criteria |create |a |% |return |as |their |calculated |result? |- |✔✔IRR, |MIRR, |and |AAR
Which |of |the |following |incremental |cash |flows |do |we |exclude |when |determining |the |cash |flows |
associated |with |a |project? |- |✔✔sunk |costs
Which |of |the |following |items |are |components |of |the |cash |flows |associated |with |a |project? |- |✔✔All |of
|these |items |are |included |when |determining |a |project's |cash |flows
Which |of |the |following |is |NOT |a |potential |adjustment |to |a |project's |cash |flows? |- |✔✔adjust |for |net |
working |capital |changes |at |the |beginning |of |the |project |only
Which |of |the |following |is |true |if |I |sell |an |asset |for |less |than |its |book |value |at |the |end |of |the |project |- |
✔✔the |after-tax |salvage |value |will |be |greater |than |the |sales |price
Which |of |the |following |incremental |cash |flows |do |we |include |when |determining |the |cash |flows |
associate |with |a |project? |- |✔✔Changes |in |net |working |capital, |taxes, |opportunity |costs
how |is |working |capital |calculated |- |✔✔current |assets |- |current |liabilities
In |which |type |of |risk |analysis |do |I |change |only |one |input |while |keeping |all |of |the |others |the |same? |- |
✔✔sensitivity |analysis
| | || | | || |
correct answers |
How |many |different |investment |criteria |did |we |review |in |the |module, |and |thus |you |are |responsible |
for |understanding? |- |✔✔7
An |investment |should |be |accepted |if |the |_____________________ |is |positive |and |rejected |if |it |is |
negative |- |✔✔NPV
Which |investment |criteria |create |a |% |return |as |their |calculated |result? |- |✔✔IRR, |MIRR, |and |AAR
Which |of |the |following |incremental |cash |flows |do |we |exclude |when |determining |the |cash |flows |
associated |with |a |project? |- |✔✔sunk |costs
Which |of |the |following |items |are |components |of |the |cash |flows |associated |with |a |project? |- |✔✔All |of
|these |items |are |included |when |determining |a |project's |cash |flows
Which |of |the |following |is |NOT |a |potential |adjustment |to |a |project's |cash |flows? |- |✔✔adjust |for |net |
working |capital |changes |at |the |beginning |of |the |project |only
Which |of |the |following |is |true |if |I |sell |an |asset |for |less |than |its |book |value |at |the |end |of |the |project |- |
✔✔the |after-tax |salvage |value |will |be |greater |than |the |sales |price
Which |of |the |following |incremental |cash |flows |do |we |include |when |determining |the |cash |flows |
associate |with |a |project? |- |✔✔Changes |in |net |working |capital, |taxes, |opportunity |costs
how |is |working |capital |calculated |- |✔✔current |assets |- |current |liabilities
In |which |type |of |risk |analysis |do |I |change |only |one |input |while |keeping |all |of |the |others |the |same? |- |
✔✔sensitivity |analysis
