Which of the Following Factors Should Be Included in the Cash

question 55

Multiple Choice

Which of the following factors should be included in the cash flows used to estimate a project's NPV?

• A) All costs associated with the project that have been incurred prior to the time the analysis is being conducted.
• B) Interest on funds borrowed to help finance the project.
• C) The end-of-project recovery of any additional net operating working capital required to operate the project.
• D) Cannibalization effects,but only if those effects increase the project's projected cash flows.
• E) Expenditures to date on research and development related to the project,provided those costs have already been expensed for tax purposes.

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Definitions:

Acknowledged

means recognized or accepted as being true or existing, often officially or formally.

Lodger

A person who has the use of property without actual or exclusive possession of it.

Direct Owner

Refers to the person or entity that has legal possession and full control over a property or asset.

License

A grant of permission to do a particular thing, to exercise a certain privilege, to carry on a particular business, or to pursue a certain occupation; an agreement that gives no property right or interest in land but merely allows the licensee to do certain acts that would otherwise be a trespass; a privilege granted by a state or city.