Corporate Investment and Finance

1. True or False ; Discounted cash flow (DCF) analysis generally assumes that firms hold assets passively when it invests in a projects

2. True or False ; The opportunities to expand a project if the project is successful is a valuable option that should be integrated into the analysis

3. True or False ; Some companies spend money up front to reduce the cost to abandon a project if the project is a failure ;

4. ;True or False ; Generally, post audits should be conducted to improve the process the next time.

5. ;True or False ;Sensitivity analysis provide an unambiguous accept or reject rule. ;

6. True or False ; It is rare for the underlying variables of a project to be interrelated.

7. True or False ; The break-even sales level to breakeven in NPV terms is always lower than the breakeven level of sales necessary to breakeven in income terms. ;

8. True or False ; Scenario analysis looks at the project by changing one variable at a time ;

9. True or False ; The larger the cost of the project the higher up in the corporation the appropriation request must go for approval.

10. ;True or False ; The wrong objective for the division could lead to wrong projects being proposed and accepted.

11. True or False ; In reality most people are quite comfortable assign probabilities to variables ;