Business Finance 2
- Created by: mustafaali1838
- Created on: 14-01-20 22:50
Other questions in this quiz
2. Working capital will affect incremental cash flows if:
- Current liabilities change more than current assets
- Net working capital changes from previous levels
- Current assets change more than current liabilities
- Inventory changes from previous levels
3. When mutually exclusive projects have different lives, the project that should be selected will have the:
- Longest life
- Lowest equivalent annual cost
- Highest IRR
- Highest NPV, discounted at the opportunity cost of capital
4. The modified accelerated cost recovery system (MACRS) allows an increase:
- In the assets depreciable cost basis
- In total depreciation over the asset's life
- In annual depreciation during earlier years
- In real but not nominal depreciation expense
5. A project's payback period is determined to be 4 years. If it is later discovered that additional cash flows will be generated in years 5 and 6, then:
- The project's payback period will be unchanged
- The discount rate must be known to determine whether the payback period changes
- The project's payback period will be reduced
- he project's payback period will be increased
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