1. True or False Discounted cash
flow (DCF) analysis generally assumes that firms hold assets passively when it
invests in a projects
2. True or False
The opportunities to expand a project if the
project is successful is a valuable option that should be integrated into the
3. True or False
Some companies spend money up front to reduce the
cost to abandon a project if the project is a failure
4. True or False
Generally, post audits should be conducted to
improve the process the next time.
5. True or False Sensitivity
analysis provide an unambiguous accept or reject rule.
6. True or False
It is rare for the underlying variables of a
project to be interrelated.
or False The break-even sales level to breakeven in NPV terms is always lower
than the breakeven level of sales necessary to breakeven in income terms.
or False Scenario analysis looks at the project by changing one variable at a
True or False The larger the cost
of the project the higher up in the corporation the appropriation request must
go for approval.
or False The wrong objective for the
division could lead to wrong projects being proposed and accepted.
True or False In reality most
people are quite comfortable assign probabilities to variables