Working capital is a frequent source of errors in estimating project cash flows. These errors include

Multiple Choice

• forgetting about working capital entirely, forgetting that working capital may change during the life of the project, and forgetting to depreciate working capital.

• forgetting that working capital may change during the life of the project, forgetting that working capital is recovered at the end of the project, and forgetting to depreciate working capital.

• forgetting about working capital entirely and forgetting that working capital may change during the life of the project.

• forgetting about working capital entirely, forgetting that working capital may change during the life of the project, and forgetting that working capital is recovered at the end of the project.