1. Explain how to evaluate the need for new projects and describe to value and manage risk for those new projects.
2. "A higher beta for the common stock caused by an increase in the operating leverage may be offset by the decrease in the financial leverage." True or false?
a. True
b. False
3. According to the financial perspective, value creation is based on (Please READ ALL alternatives before answering):
a. only the size of cash flows of the firm
b. only the timing & risk of the cash flows
c. only the net income, aka profits, of the firm
d. only the size of the cash flows and the net income of the firm
e. the SIZE, TIMING, AND RISK of the cash flows of the firm