Three of the Most Common Tools of Financial Analysis Are

question 113

Short Answer

Three of the most common tools of financial analysis are (1) ________, (2) ________, and (3)________.

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Definitions:

Mutually Exclusive

Situations or events that cannot occur at the same time, implying that the occurrence of one event excludes the occurrence of the other.

NPV

Net Present Value, a method to assess the profitability of an investment by comparing the present value of cash inflows to the present value of cash outflows.

NPV

Net Present Value is a financial measure that determines the discrepancy between the present value of money coming in and going out over a certain timeframe.

PI

Stands for Profitability Index, which measures the ratio of payoff to investment of a proposed project.