For a Tax-Paying Firm,the Net Present Value of a Project

question 62

Multiple Choice

For a tax-paying firm,the net present value of a project will increase when:

• A)the initial net working capital requirement increases.
• B)depreciation is decreased during the early years of a project's life.
• C)the life of the fixed assets used by that project is increased.
• D)the operating cash flows increase.
• E)the tax rate increases.

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Definitions:

Increase

A rise in quantity, value, or some other measure, indicating growth or expansion.

Throughput Time

The total time taken from the start to the finish of a production process, including both processing and wait times.

Fill Orders

The process of completing customer requests for goods or services, involving tasks from accepting, processing, and delivering the order.

Delivery Cycle Time

The total time taken from the initiation of a process or order until its completion and delivery to the customer.