1. a negative impact on the cash flows of an existing product from the introduction of a new product is called erosion. in this case, the cash flows from the new line should be adjusted upward to reflect lost profits on other lines. True or False

2. The depreciation tax shield is the tax saving the results from the depreciation deduction, calculated as depreciation mutiplied by the corporate tax rate. True or False

3. the bottom up approach to calculating operating cash flow is described by the following formula: OCF=Sales-Costs-Taxes True or False

4. The stand alone principle is the assumption that evaluation of a project may be based on the projects incremental cash flows.

5. the formula for calculating the account break-even is as follows Q= (FC-D)/(P+vc) True or False.

6. The possibility that errors in projected cash flows will lead to incorrect decisions called "forecasting risk", also known as "estimation risk". True or False