Corporate Finance 10th Edition test bank ch06

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1、ch06Student:1.Thechangesinafirm'sfuturecashflowsthatareadirectconsequenceofacceptingaprojectarecalledcashflows.A.incrementalB.stand-aloneC.after-taxD.netpresentvalueE.erosion2.Theannualannuitystreamofpaymentswiththesamepresentvalueasaproject'scostsisc

2、alledtheproject'scost.A.incrementalB.sunkC.opportunityD.erosionE.equivalentannual3.Acostthathasalreadybeenpaid,ortheliabilitytopayhasalreadybeenincurred,isa(n):A.salvagevalueexpense.B.networkingcapitalexpense.C.sunkcost.D.opportunitycost.E.erosioncost

3、.4.Themostvaluableinvestmentgivenupifanalternativeinvestmentischosenisa(n):A.salvagevalueexpense.B.networkingcapitalexpense.C.sunkcost.D.opportunitycost.E.erosioncost.5.Thecashflowsofanewprojectthatcomeattheexpenseofafirm'sexistingprojectsarecalled:A.

4、salvagevalueexpenses.B.networkingcapitalexpenses.C.sunkcosts.D.opportunitycosts.E.erosioncosts.6.Aproformafinancialstatementisonethat:A.projectsfutureyears'operations.B.isexpressedasapercentageofthetotalassetsofthefirm.C.isexpressedasapercentageofthet

5、otalsalesofthefirm.D.isexpressedrelativetoachosenbaseyear'sfinancialstatement.E.reflectsthepastandcurrentoperationsofthefirm.7.ThedepreciationmethodcurrentlyallowedunderU.S.taxlawgoverningtheacceleratedwrite-offofpropertyundervariouslifetimeclassifica

6、tionsiscalleddepreciation.A.FIFOB.MACRSC.straight-lineD.sum-of-yearsdigitsE.curvilinear8.Thecashflowtaxsavingsgeneratedasaresultofafirm'stax-deductibledepreciationexpenseiscalledthe:A.after-taxdepreciationsavings.B.depreciablebasis.C.depreciationtaxsh

7、ield.D.operatingcashflow.E.after-taxsalvagevalue.9.Thecashflowfromprojectsforacompanyiscomputedasthe:A.netoperatingcashflowgeneratedbytheproject,lessanysunkcostsanderosioncosts.B.sumoftheincrementaloperatingcashflowandafter-taxsalvagevalueoftheproject

8、.C.netincomegeneratedbytheproject,plustheannualdepreciationexpense.D.sumoftheincrementaloperatingcashflow,capitalspending,andnetworkingcapitalexpensesincurredbytheproject.E.sumofthesunkcosts,opportunitycosts,anderosioncostsoftheproject.10.Inte