If Project a Generates $10 Million of Free Cash Flow

question 142

True/False

If project A generates $10 million of free cash flow over its five year useful life and project B generates $8 million of free cash flow over its five year useful life,then Project A will have a shorter payback period than Project B,assuming both projects require the same initial investment.

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Definitions:

Royal Commission

is a major formal public inquiry, typically appointed by a government, to investigate and report on complex issues of significant importance.

Aboriginal Peoples

Indigenous individuals and communities who are native to a land or country, especially those recognized as such in countries like Canada, Australia, and others.

Primary Sector

The sector of an economy involving the extraction and harvesting of natural resources directly from the earth, such as agriculture, mining, and forestry.

Tertiary Sector

This term refers to the sector of an economy focused on services rather than the production of goods, including areas such as retail, entertainment, and financial services.