Quiz 6

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School

Indiana Institute of Technology *

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Course

3600

Subject

Finance

Date

Feb 20, 2024

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pdf

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4

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1/18/24, 4:43 PM Review Test Submission: Module 6 Quiz 2023_... TECH <] . B YT S 2 2023_Fall_FIN3600EOL41 Corporate Finance - 41 Module Six Module 6 Activities and Assessments Review Test Submission: Module 6 Quiz Review Test Submission: Module 6 Quiz User Course Corporate Finance - 41 Test Module 6 Quiz Started 1/18/24 4:27 PM Submitted 1/18/24 4:43 PM Due Date 1/21/24 11:59 PM Status Completed | Attempt Score 13 out of 15 points Time Elapsed 15 minutes out of 1 hour Results Displayed Submitted Answers, Correct Answers, Incorrectly Answered Questions Question 1 1 out of 1 points | Capital budgeting is placed on an incremental basis, meaning that ___ must be \_d ignored and ____ must be considered. Selected Answer: @ sunk costs; opportunity cost Correct Answer: V) sunk costs; opportunity cost Question 2 1 out of 1 points ! 77 i Business risk is the combination of sales risk and: Selected Answer: V) Operating risk Correct Answer: @ Operating risk Question 3 1 out of 1 points The difference between current assets and current liabilities is referred to as: Selected Answer: V) net working capital. https://blackboard.indianatech.edu/webapps/assessment/review/review.jsp?attempt_id=_4437054_1&course_id=_422729_1&content_id=_3528047_1... 1/4
1/18/24, 4:43 PM Review Test Submission: Module 6 Quiz 2023 _... Correct Answer: @ net working capital. Question 4 0 out of 1 points ~ 7. | The payback method: Selected Q | Answer: is the amount of time it takes for a project to recoup its profits. | Correct Answer: V) does not explicitly consider the time value of money. Question 5 1 out of 1 points A cost that has already been incurred whether a project is accepted or not is known as a: Selected Answer: V) sunk cost. Correct Answer: @ sunk cost. Question 6 1 out of 1 points | The process of identifying the capital projects a firm should invest in is known as: Selected Answer: V) capital budgeting. Correct Answer: ) capital budgeting. Question 7 1 out of 1 points Greg earns $100,000 as an engineer, and he is considering quitting his job and going to graduate school. This $100,000 should be treated as a ___if Greg runs an NPV analysis of his graduate degree. Selected Answer: V) opportunity cost Correct Answer: @ opportunity cost Question 8 1 out of 1 points | The acceptance of one project that precludes the acceptance of another project is | referred to as a(n): Selected Answer: @ Mutually exclusive project https://blackboard.indianatech.edu/webapps/assessment/review/review.jsp?attempt_id=_4437054_18course_id=_422729_1&content_id=_3528047_1... 2/4
1/18/24, 4:43 PM Review Test Submission: Module 6 Quiz 2023 _... Correct Answer: V) Mutually exclusive project Question 9 0 out of 1 points The discount rate is the: Selected Answer: Q Interest rate Correct Answer: V) Required rate of return Question 10 1 out of 1 points The preferred capital budgeting technique for evaluating most capital investments is Selected Answer: @ netpresent value Correct Answer: V) net present value Question 11 1 out of 1 points The comparison of the projecta s actual cash flows to the estimated cash flows in l the proposal is known as: Selected Answer: @ Post-completion audit Correct Answer: V) Post-completion audit Question 12 1 out of 1 points | The NPV method focuses on: Selected Answer: @ cash flows. Correct Answer: @ cash flows. Question 13 1 out of 1 points Cash Flows that occur if and only if a project is accepted are: Selected Answer: ) incremental cash flows. Correct Answer: ) incremental cash flows. https://blackboard.indianatech.edu/webapps/assessment/review/review.jsp?attempt_id=_4437054_1&course_id=_422729_1 &content_id=_3528047_1... 3/4
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1/18/24, 4:43 PM Review Test Submission: Module 6 Quiz 2023 _... Question 14 1 out of 1 points The acceptance of one project that is dependent on the acceptance of another project is referred to as a(n): Selected Answer: V) Contingent project Correct Answer: V) Contingent project Question 15 1 out of 1 points 7| Magna Industries is evaluating the NPV of launching a new product. Magna paid a market research firm $150,000 last year to test the market viability of the new product. Magna should treat this $150,000 as a ___for the capital budgeting decision now confronting the firm. Selected Answer: @ sunk cost Correct Answer: [V sunk cost | Thursday, January 18, 2024 4:43:34 PM EST «— 0K https://blackboard.indianatech.edu/webapps/assessment/review/review.jsp?attempt_id=_4437054_18&course_id=_422729_1&content_id=_3528047_1... 444