Which of the Following Adjustments Is NOT Correct If You

question 87

Multiple Choice

Which of the following adjustments is NOT correct if you are trying to calculate cash flow from financing activities?

• A)Add dividends paid
• B)Add any increase in long-term borrowing
• C)Add any increase in short-term borrowing
• D)Add proceeds from the sale of stock

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Definitions:

Net Present Value Method

A valuation method that calculates an investment's worth by determining the present value of its expected future cash flows, subtracting the initial investment cost.

Capital Investment Analysis

The process of evaluating investments in physical assets to determine their potential for profit.

Sensitivity Analysis

Sensitivity Analysis is a financial modeling tool used to determine how different values of an independent variable affect a particular dependent variable under a given set of assumptions.

Expected Value Analysis

A statistical technique used to predict the likely outcome of a decision or series of actions by considering all possible scenarios and their probabilities.