50 Multiple Choice Business †Finance Questions - 1740 Words

I need help answering 50 multiple choice Business – Finance Questions. 1. Which of the following is NOT a cash flow that should be included in the analysis of a project? a. Changes in net operating working capital. b. Shipping and installation costs. c. Cannibalization effects. d. Opportunity costs. e. Sunk costs that have been expensed for tax purposes. 2. When evaluating a new project, firms should include in the projected cash flows all of the following factors EXCEPT: a. Changes in net operating working capital attributable to the project. b. Previous expenditures associated with a market test to determine the feasibility of the project that have been expensed for tax purposes. c. The value of a building owned by†¦show more content†¦6. A firm is considering the purchase of an asset whose risk is greater than the firm’s current risk, based on all methods for assessing risk. In evaluating this asset, it would be reasonable for the decision maker to a. Increase the IRR of the asset to reflect its greater risk. b. Increase the NPV of the asset to reflect the greater risk. c. Reject the asset, since its acceptance would increase the firm’s risk. d. Ignore the risk differential if the project would amount to only a small fraction of the firm’s total assets. e. Increase the cost of capital used to evaluate the project to reflect the project’s higher risk. 7. Commodore Corporation is deciding whether to invest in a project today or to postpone the decision for one year. Which of the following statements best describes the issues that Commodore faces when considering this investment timing option? a. The investment timing option does not affect the expected cash flows and should therefore have no impact on the project’s risk. b. The more uncertainty about the project’s future cash flows the more likely it is that Commodore will go ahead with the project today. c. If the project has a positive expected NPV today, this means that its expected NPV will be even higher if it chooses to wait a year. d. The investment timing option will either add positive or no value, and it will not reduceShow MoreRelatedMethodology Adopted for Study about Leasing Business in Mauritius860 Words   |  3 PagesChapter 4: Research Methodology This chapter is devoted to the methodology which will be adopted in carrying out a study about leasing business in Mauritius. It will consider the methodology of a study among the Mauritian population possessing a vehicle. 4.1 Research Process According to Kotler (1996), research is the systematic collection, analysis, reporting of data and findings relevant to a specific situation. 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