Which one of these statements is correct? Accountants record sales and expenses after the related cash flows occur. The value of an investment depends on the size, timing, and risk of the investment's cash flows. Individuals tend to prefer later cash flows over current cash flows. When selecting one of two projects, managers should select the project with the higher total expected cash flow Most investors prefer greater risk over less risk.

Which one of these statements is correct? Accountants record sales and expenses after the related cash flows occur. The value of an investment depends on the size, timing, and risk of the investment's cash flows. Individuals tend to prefer later cash flows over current cash flows. When selecting one of two projects, managers should select the project with the higher total expected cash flow Most investors prefer greater risk over less risk.

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Select all that are true with respect to the Cost of Capital. Group of answer choices The cost of capital is the discount rate to use when evaluating investment opportunities There is one cost of capital for every firm, and that one rate should be used for evaluating all investment opportunities The cost of capital for an asset is driven by an asset's riskiness The cost of capital is driven by how we raise funds to pay for an investment opportunity The cost of capital for a project is driven by the systematic risk of that project When estimating the cost of capital for a project, it is the total risk of that project that matters
Which of the following scenario shows the financial manager’s financing function? a. Prioritizing investments based on properly computed capital rationing method. b. Capital budgeting computation and decision with regards to the planned acquisition. c. Assessing and selecting a long-term and short-term financing tools that has a low cost. d. Monitoring trends in operating expenses for the purpose of budget allocation.
Can replacement chain analysis be used if project cash flows are different each time the project is repeated? Select one: a. The replacement chain can still be used when the cash flows are different each time the project is repeated. b. The replacement chain cannot be used when the cash flows are different each time the project is repeated. c. The replacement chain can still be used when the cash flows are different each time the project is not repeated. d. The replacement chain can be used when the cash flows are the same each time the project is repeated.
I need the answer as soon as possible
If you as a business owner know that your bank will provide financing for a project and that the cash generated from the project must cover the loan payments, would you then have to include financing in your capital budgeting decision? Why or why not?
Why bother with a technical evaluation, anyway? Explain its purpose, how it is used, and how it may help technicians determine when it's best to make financial investments.
Capital budgeting techniques aid businesses with investment decision-making. Many approaches can be used, with some being more advanced than others. Describe the payback period approach to capital budgeting. Explain 1 advantage and 1 disadvantage of the technique. Explain why it would be wise for a financial manager to learn advanced capital budgeting techniques.
A. it is very A disadvantage of the average rate of return method of capital investment analysis is that complex to compute B. it does not include the entire amount of income earned over the life of a project C. it does not emphasize accounting income, which is often used by investors and creditors in evaluating management performance D. it does not directly consider the timing of the expected cash flows
Which of the following statement is required for maintaining Inter-relation with other departments by finance manager? a.He must be well versed in the field of capital budgeting techniques to determine the effective utilization of investment b.He should have sound knowledge not only in finance related area but also well versed in other areas of activity c.He must concentrate to the principles of safety, liquidity and profitability while investing capital d.He is responsible to estimate the financial requirement of the business concern
Provide real-world example of an organization you are familiar with employing financial investment strategies with attention to mitigating risk
Recommend an asset allocation that matches the Johnsons' financial objectives and their moderate risk tolerance. Make sure you indicate what the asset allocation is and why it meets their needs.
Which of the following is not a reason for risk and uncertainty in capital budgeting? a. Decisions are based on expected cash flows b. All decisions are based on forecasts c. Decisions are based on past cash flows d. All forecasts are subject to uncertainty Clear my choice

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