Cash Flows Used in Calculating the Net Present Value Need

question 36

True/False

Cash flows used in calculating the net present value need not be adjusted for inflation because the interest rate used to discount the cash flows has already considered inflation.

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Definitions:

Conditional Probability

The likelihood of one event happening after another event has already taken place.

Independent Events

Events whose occurrence or outcome is not influenced by one another; the outcome of one event does not affect the outcome of another.

Mutually Exclusive Events

Two or more events that cannot occur at the same time within a given experimental setup.

Mutually Exclusive Events

Two events that cannot occur at the same time.