Organizational Finance 1. What is the time value of money? How does it apply to your personal life? How does it apply in business situations? Why is a dollar today worth more than a dollar in the future? 2. Is there only one measure of company performance when evaluating capital projects? Why or why not? If not, what are other measures of company performance when evaluating capital projects? 3. What is the point of doing sensitivity analysis to evaluate capital project performance? Why not use one set of assumptions for each capital project? What can change when evaluating a capital project? 4. Why is depreciation added back to cash flow when evaluating a capital project? Isnt depreciation an expense in the Income Statement? 5. Why is operating income used when computing project performance rather than net income? 6. Why should you use incremental operating income when evaluating project performance?