If We Are Using Foreign Currency for the NPV Decision,all

question 24

Multiple Choice

If we are using foreign currency for the NPV decision,all we have to do is restate all the ________ in terms of present value and use the current exchange rate.

• A)domestic incremental cash flow
• B)foreign incremental cash flow
• C)salvage value
• D)None of these

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Definitions:

Fixed Assets

Long-term tangible assets that a company owns and uses in its operations to generate income, such as buildings, machinery, and equipment.

Sales Increase

A situation where a company experiences a rise in the volume or value of its product sales over a particular period.

Operating Capacity

The maximum output a company can produce using its current resources and technology.