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Version a 32. Net present value (NPV): A is equal to the initial investment in a project 15. compares a project's cost to the best
Version a 32. Net present value (NPV): A is equal to the initial investment in a project 15. compares a project's cost to the best value of the projects bactis C. is equal to zero when the discount D. is simplified by the fact that future E requires the firm set an arbitrary than the internal rate ofron acceptable or not. shows to and for determining whether e casy to estimate investime 33. Net operating working capital is tymically equal inflow at the end, thus having no impact on NPV. A. True set the beginning of a project B. False 34. Adams Audio is considering whether to make an investment in a new type of this Which of the following factors should the company consider when it decide whether undertake the investment? 1. The company has already spent $3 million rescarching the technology IL The new technology will affect the cash flows produced by its other operations III. If the investment is not made, then the company will be able to sell one of its laboratories for $2 million A. II only B. I and II C. I and III D. II and III E. I, II and III 35. If debt is to be used to finance a project, then when cash flows for a project are estimated, interest expense should be included in the analysis. A. True B. False 36. Upon the sale of equipment at the end of its useful life, tax liability will be incurred whenever the book value of the equipment exceeds the sales price. A. True. B. False
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