When Writing Any Type of Question Asking About Behaviors It

question 27

True/False

When writing any type of question asking about behaviors it is important to provide a reasonable time frame.

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Definitions:

Payback Cutoff

The maximum allowable period for an investment to recoup its initial cost, beyond which it is not considered.

NPV

Net Present Value; a calculation used to determine the present value of a series of future cash flows, less the initial investment.

Conventional Cash Flow

A pattern of cash flow over time where an initial outlay is followed by a series of positive cash inflows.

Cash Flows

The entirety of cash and cash-equivalent assets being moved into and exiting a company.