question archive 1) In annual cash flow analysis, the goal is ? a
Subject:BusinessPrice: Bought3
1) In annual cash flow analysis, the goal is ?
a. To convert a future value of money F into a breakeven estimate.
b. To convert a present sum of money P into an equivalent series of uniform annual cash
flows A.
c. To estimate the minimum attractive rate of return.
d. To convert the MARR into an equivalent series of uniform annual cash flows.
2) Under annual cash flow analysis if projects A and B are of unequal lives but are for a
continuing requirement with identical replacement after their respective useful lives, the
analysis period is?
a. The maximum life of the alternatives.
b. The minimum life of the alternatives.
c. The respective life of each alternative.
d. Always the common project life.
3) In engineering economic analysis, the "end-of-period convention" may be defined as?
a. No economic analysis is performed until the end of the project when you have receipts
for actual costs and cash flows may be accounted for under GAAP rules.
b. Cash flows are end-of-period receipts or disbursements.
c. Total cash flows comprising resultant present or future values.
d. The MARR interest rate can be determined only for end-of-period receipts or
disbursements.
4) The financial definition of un-discounted payback period is?
a. The period of time required to recover the cost of an investment from the new cash
flows produced by the investment for an interest rate of zero.
b. The period of time necessary for internal rate of return < MARR interest rate.
c. The period of time required to recover the cost of an investment from the new cash
flows produced by the investment at the MARR interest rate.
d. The period of time required to recover the cost of an investment from the new cash
flows produced by the investment at the internal rate of return.