1. The NPV method is based on the assumption that projects' cash flows are reinvested at the project's risk-adjusted cost of capital.
a. True
b. False
2. A "reverse split" reduces the number of shares outstanding.
a. True
b. False
3. Your firm's cost of goods sold (COGS) average $2,000,000 per month, and it keeps inventory equal to 50% of its monthly COGS on hand at all times. Using a 365-day year, what is its inventory conversion period?
a. 13.7 days
b. 14.0 days
c. 15.2 days
d. 15.7 days
e. 14.8 days