[单选题]Project X has cash flows of $8,500, $8,000, $7,500, and $7,000 for Years 1 to 4, respectively. Project Y has cash flows of $7,000, $7,500, $8,000, and $8,500 for Years 1 to 4, respectively. Which one of the following statements is true concerning these two projects given a positive discount rate? (No calculations needed.
A. Both projects have the same future value at the end of Year 4.
B. Both projects have the same value at Time 0.
C. Both projects are ordinary annuities.
D. Project Y has a higher present value than Project X.
E. Project X has both a higher present and a higher future value than Project Y.
Difficulty: 1 Easy
Topic: Present value - multiple cash flows
Learning Objective: 06-01 Determine the future and present value of investments with multiple cash flows.

[单选题]Project A has cash flows of $4,000, $3,000, $0, and $3,000 for Years 1 to 4, respectively. Project B has cash flows of $2,000, $3,000, $2,000, and $3,000 for Years 1 to 4, respectively. Which one of the following statements is correct assuming the discount rate is positive? (No calculations needed.
A. The cash flows for Project B are an annuity, but those of Project A are not.
B. Both sets of cash flows have equal present values as of Time 0.
C. The present value at Time 0 of the final cash flow for Project A will be discounted using an exponent of three.
D. Both projects have equal values at any point in time since they both pay the same total amount.
E. Project B is worth less today than Project A
Difficulty: 1 Easy
Topic: Present value - multiple cash flows
Learning Objective: 06-01 Determine the future and present value of investments with multiple cash flows.

[单选题]A project's cash flow is equal to the project's operating cash flow:
A. plus the project's depreciation expense minus both the project's taxes and capital spending.
B. minus both the project's change in net working capital and capital spending.
C. minus the project's change in net working capital plus all of the depreciation expenses.
D. plus the project's depreciation expenses minus the project's taxes.
E. minus the project's taxes.
Difficulty: 1 Easy
Topic: Cash flows
Learning Objective: 10-01 Determine the relevant cash flows for a proposed project.

[单选题]Which one of the following is a project cash inflow? Ignore any tax effects.
A. Decrease in accounts payable
B. Increase in accounts receivable
C. Decrease in inventory
D. Depreciation expense
E. Equipment acquisition
Difficulty: 1 Easy
Topic: Cash flows
Learning Objective: 10-01 Determine the relevant cash flows for a proposed project.

[单选题]According to the statement of cash flows, an increase in interest expense will ________ the cash flow from ________ activities.
A. decrease; operating
B. decrease; financing
C. increase; operating
D. increase; financing
E. Increase; investment
Difficulty: 1 Easy
Topic: Statement of cash flows
Learning Objective: 03-01 Standardize financial statements for comparison purposes.

[单选题]On the statement of cash flows, which one of the following is considered an operating activity?
A. Increase in net fixed assets
B. Decrease in accounts payable
C. Purchase of equipment
D. Dividends paid
E. Repayment of long-term debt
Difficulty: 1 Easy
Topic: Statement of cash flows
Learning Objective: 03-01 Standardize financial statements for comparison purposes.

[单选题]A project has a discounted payback period that is equal to the required payback period. Given this, the project:
A. will not be acceptable under the payback rule.
B. must have a profitability index that is equal to or greater than 1.0.
C. must have a zero net present value.
D. must have an internal rate of return equal to the required return.
E. will still be acceptable if the discount rate is increased.
Difficulty: 1 Easy
Topic: Discounted payback
Learning Objective: 09-03 Discuss the discounted payback rule and some of its shortcomings.

[单选题]A project has a required payback period of three years. Which one of the following statements is correct concerning the payback analysis of this project?
A. The cash flows in each of the three years must exceed one-third of the project's initial cost if the project is to be accepted.
B. The cash flow in Year 3 is ignored.
C. The project's cash flow in Year 3 is discounted by a factor of (1 + R.3.
D. The cash flow in Year 2 is valued just as highly as the cash flow in Year 1.
E. The project is acceptable whenever the payback period exceeds three years.
Difficulty: 1 Easy
Topic: Payback
Learning Objective: 09-02 Discuss the payback rule and some of its shortcomings.

[单选题]If a project has a net present value equal to zero, then:
A. the total of the cash inflows must equal the initial cost of the project.
B. the project earns a return exactly equal to the discount rate.
C. a decrease in the project's initial cost will cause the project to have a negative NPV.
D. any delay in receiving the projected cash inflows will cause the project to have a positive NPV.
E. the project's PI must also be equal to zero.
Difficulty: 1 Easy
Topic: Net present value
Learning Objective: 09-01 Show the reasons why the net present value criterion is the best way to evaluate proposed investments.

[单选题]A project has a net present value of zero. Which one of the following best describes this project?
A. The project has a zero percent rate of return.
B. The project requires no initial cash investment.
C. The project has no cash flows.
D. The summation of all of the project's cash flows is zero.
E. The project's cash inflows equal its cash outflows in current dollar terms.
Difficulty: 1 Easy
Topic: Net present value
Learning Objective: 09-01 Show the reasons why the net present value criterion is the best way to evaluate proposed investments.

[单选题]A project has an initial cost of $31,800 and a market value of $29,600. What is the difference between these two values called?
A. Net present value
B. Accounting return
C. Payback value
D. Profitability index
E. Discounted payback
Difficulty: 1 Easy
Topic: Net present value
Learning Objective: 09-01 Show the reasons why the net present value criterion is the best way to evaluate proposed investments.

[单选题]The project has to be put off ____ lack of finance.
A.despite
B.in spite of
C.prior to
D.due to

[单选题]4.Two-way international capital flows can be explained by the desire to:
A.A.earn higher yields abroad
B.B.avoid tariffs
C.C.diversify risks
D.D.all of the above

[单选题] Which of the following statements about cash management accounts (CMAs. are true?
A. The cash management account was developed in 1977 by Merrill Lynch.
B. The advantage of brokerage-based cash management accounts is that they make it easier to buy and sell securities.
C. As a result of CMAs, the distinction between banking activities and the activities of nonbank financial institutions has become more clearly defined.
D. All of the above are true.
E. Only A and B of the above are true.

[单选题]The sources and uses of cash over a stated period of time are reflected on the:
A. income statement.
B. balance sheet.
C. tax reconciliation statement.
D. statement of cash flows.
E. statement of operating position.
Difficulty: 1 Easy
Topic: Statement of cash flows
Learning Objective: 03-01 Standardize financial statements for comparison purposes.

[单选题]Which one of the following is a use of cash?
A. Decrease in fixed assets
B. Decrease in inventory
C. Increase in long-term debt
D. Decrease in accounts receivables
E. Decrease in accounts payable
Difficulty: 1 Easy
Topic: Sources and uses of cash

[单选题]Although the original budget for the project was one billion Yuan, ( ) the
Cost is likely to be 50% higher.虽然该项目原本的预算是10亿元，但最后可能会多出百分之50
A. locally
B. genuinely
C. similarly
D. eventually最后，终于