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- Introduction to Corporate FinanceFinancial Statements,Taxes,and Cash FlowWorking With Financial StatementsLong-Term Financial Planning and GrowthIntroduction to Valuation: The Time Value of MoneyDiscounted Cash Flow ValuationInterest Rates and Bond ValuationStock ValuationNet Present Value and Other Investment CriteriaMaking Capital Investment DecisionsProject Analysis and EvaluationSome Lessons From Capital Market HistoryReturn,Risk,and the Security Market LineCost of CapitalRaising CapitalFinancial Leverage and Capital Structure PolicyDividends and Payout PolicyShort-Term Finance and PlanningCash and Liquidity ManagementCredit and Inventory ManagementInternational Corporate FinanceBehavioral Finance: Implications for Financial ManagementEnterprise Risk ManagementOptions and Corporate FinanceOption ValuationMergers and AcquisitionsLeasing

Question 1

Free

Multiple Choice

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net present value

internal return

payback value

profitability index

discounted payback

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Question 2

Free

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constant dividend growth model

discounted cash flow valuation

average accounting return

expected earnings model

internal rate of return

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Question 3

Free

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internal return period.

payback period.

profitability period.

discounted cash period.

valuation period.

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Question 4

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net present value period.

internal return period.

payback period.

discounted profitability period.

discounted payback period.

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Question 5

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net present value.

internal rate of return.

accounting return.

profitability index.

payback period.

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Question 6

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maximum rate of return a firm expects to earn on a project.

rate of return a project will generate if the project in financed solely with internal funds.

discount rate that equates the net cash inflows of a project to zero.

discount rate which causes the net present value of a project to equal zero.

discount rate that causes the profitability index for a project to equal zero.

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Question 7

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project tract

projected risk profile

NPV profile

NPV route

present value sequence

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Question 8

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have two net present value profiles.

have operational ambiguity.

create a mutually exclusive investment decision.

produce multiple economies of scale.

have multiple rates of return.

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Question 9

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independent.

interdependent.

mutually exclusive.

economically scaled.

operationally distinct.

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Question 10

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net present value.

internal rate of return.

average accounting return.

profitability index.

profile period.

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Question 11

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The project has a zero percent rate of return.

The project requires no initial cash investment.

The project has no cash flows.

The summation of all of the project's cash flows is zero.

The project's cash inflows equal its cash outflows in current dollar terms.

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Question 12

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increasing the value of each of the project's discounted cash inflows

moving each of the cash inflows forward to a sooner time period

decreasing the required discount rate

increasing the project's initial cost at time zero

increasing the amount of the final cash inflow

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Question 13

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net present value

discounted payback

internal rate of return

profitability index

payback

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Question 14

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the total of the cash inflows must equal the initial cost of the project.

the project earns a return exactly equal to the discount rate.

a decrease in the project's initial cost will cause the project to have a negative NPV.

any delay in receiving the projected cash inflows will cause the project to have a positive NPV.

the project's PI must be also be equal to zero.

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Question 15

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reduction in the cash outflow at time zero

cash inflow in the final year of the project

cash inflow for the year following the final year of the project

cash inflow prorated over the life of the project

not included in the net present value

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Question 16

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an increase in the required rate of return

an increase in the initial capital requirement

a deferment of some cash inflows until a later year

an increase in the aftertax salvage value of the fixed assets

a reduction in the final cash inflow

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Question 17

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is the best method of analyzing mutually exclusive projects.

is less useful than the internal rate of return when comparing different sized projects.

is the easiest method of evaluation for non-financial managers to use.

is less useful than the profitability index when comparing mutually exclusive projects.

is very similar in its methodology to the average accounting return.

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Question 18

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profitability index less than 1.0

project's internal rate of return less than the required return

discounted payback period greater than requirement

average accounting return that is less than the internal rate of return

modified internal rate of return that exceeds the required return

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Question 19

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Payback considers the time value of money.

All relevant cash flows are included in the payback analysis.

It is the only method where the benefits of the analysis outweigh the costs of that analysis.

Payback is the most desirable of the various financial methods of analysis.

Payback is focused on the long-term impact of a project.

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Question 20

Multiple Choice

I)works well for research and development projects

II)liquidity bias

III)ease of use

IV)arbitrary cutoff point

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I and II only

I and III only

II and III only

II and IV only

II, III, and IV only

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