The Process of Estimating Expected Future Cash Flows of a Project

question 14

Multiple Choice

The process of estimating expected future cash flows of a project using only the relevant parts of the balance sheet and income statements is referred to as

• A) substitute and complement.
• B) pro forma analysis.
• C) incremental cash flows.
• D) estimation and depreciation analysis.

---

Definitions:

Herfindahl Index

A measure of market concentration used to determine the level of competition within an industry by summing the squares of the market shares for each firm.

Import Competition

The competitive pressure on domestic companies from foreign products and services entering the domestic market.

Oligopoly

A market structure characterized by a small number of large firms that dominate the market, leading to limited competition and the potential for collaborative behavior.