1. You are estimating the value of a planned project and your first step is to find the present value (PV) of all the cash inflows from that project. If you increase the discount rate you use, the project's NPV will improve

True

False

2.

Which of the following statements about per procedure (per use) leases is most correct?

	a.	Such leases eliminate risk for the lessor.
	b.	Such leases replace a fixed lease payment with a payment based on number of procedures.
	c.	The lessee eliminates its risk with such a lease.
	d.	Such leases are seldom useful to the lessee.

3. Projects are classified by purpose, such as replacement vs. expansion projects, but size of the investment, such as over or under $1M is not considered in capital budgeting decisions.

True

False

4. Under current accounting rules, operating leases have to be capitalized on the balance sheet.

True

False

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