Question
10. Which of the following is the classic exception to the ordinary annuity situation? a .A mortgage with a balloon payment b. A lease with
10. Which of the following is the classic exception to the ordinary annuity situation?
a .A mortgage with a balloon payment
b. A lease with front-end payments
c. A lease with back-end payments
d. A variable rate mortgage
11. Which of the following is a method for estimating the cost of a capital project that reflects total costs, both operational and capital, over the projects estimated useful life?
a. Project-based costing
b. Volume-projection costing
c. Lifecycle costing
d. Annual volume costing
12. Which stage of the capital decision-making process is extremely important because inadequate or inaccurate information can lead to poor decision making?
a. Generation of project information
b. Evaluation of projects
c. Decisions about which projects to find
d. Project implementation and reporting
13. To a large extent, which of the following is viewed as being synonymous with financial data?
a. Qualitative data
b. Quantitative data
c. Nonquantitative data
d. Ordinal data
14. Which of the following analyses is a useful way to analyze alternative methods of capital financing?
a. Net present value
b. Profitability index
c. Equivalent annual cost
d. Cost-effectiveness analysis
15. Which of the following is the most widely discussed and used method of defining the discount rate?
a. Cost of specific financing source
b. Yield achievable on other investments
c. Weighted cost of capital
d. Cost-effectiveness analysis
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