Depreciation is considered to be an outflow of cash. Indicate ...

[oliviahorn72]

Depreciation is considered to be an outflow of cash.
 
  Indicate whether the statement is true or false

Question 2

Consider the following projects, X and Y, where the firm can only choose one. Project X costs 600 and has cash flows of 400 in each of the next 2 years.
 
  Project Y also costs 600, and generates cash flows of 500 and 275 for the next 2 years, respectively. Which investment should the firm choose if the cost of capital is 10 percent?
  A) Project X, since it has a higher NPV than Project Y
  B) Project Y, since it has a higher NPV than Project X
  C) Project X, since it has a lower NPV than Project Y
  D) Project Y, since it has a lower NPV than Project X

[ms_sulzle]

Answer to Question 1

FALSE

Answer to Question 2

A

[oliviahorn72]

Excellent

[raili21]

TYSM