The Present Value of the Expected Net Cash Inflows for a Project

question 65

Multiple Choice

The present value of the expected net cash inflows for a project will most likely exceed the present value of the expected net profit after tax for the same project because

• A) Income is reduced by taxes paid,but cash flow is not.
• B) There is a greater probability of realizing the projected cash flow than the forecasted income.
• C) Income is reduced by dividends paid,but cash flow is not.
• D) Income is reduced by depreciation charges,but cash flow is not.
• E) Cash flow reflects any change in net working capital,but sales do not.

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Definitions:

Deceit

The act of misleading or deceiving someone intentionally.

False Representation

The act of making an untrue or misleading statement about a product, service, or situation which may deceive others.

Intention of Deceiving

The deliberate act of misleading or tricking someone to gain an advantage or cause harm.

Libel

A written or published defamatory statement or representation that conveys an unjustly unfavorable impression; a form of defamation.