If You Start with Incremental Net Operating Profits After Tax

question 69

True/False

If you start with incremental net operating profits after tax (NOPAT) and add depreciation and amortization to it, then you will obtain incremental cash flow from operations.

---

Definitions:

Beta

An indicator of the level of systematic risk or volatility of a security or a portfolio relative to the entire market.

Total Risk

The complete range of risks associated with an investment, including both systematic risk (market related) and unsystematic risk (company or industry specific).

Standard Deviation

A measure of the dispersion or variability of a set of data points from its mean, often used in finance to gauge investment risk.

Risk Premium

The extra return above the risk-free rate that investors require to compensate them for holding a risky asset.