Author Question: When evaluating a new project, which of the following should firms NOT include in the projected cash flows? (Read 87 times)

Austinleez3 · **on:** Aug 7, 2023

Question 1

What will result from a decrease in the risk-adjusted discount rate for a less risky project?

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an increase in the NPV

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an increase in the IRR

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no change in the NPV

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a decrease in the NPV

Question 2

When evaluating a new project, which of the following should firms NOT include in the projected cash flows?

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changes in net working capital attributable to the project

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the value of a building owned by the firm that will be used for this project

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previous expenditures associated with a market test to determine the feasibility of the project provided those costs have been expensed for tax purposes

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the salvage value of assets used for the project at the end of the project’s life

breounasmoot · **Reply #1 on:** Aug 7, 2023

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