Many projects in the first year will provide an increase to something called 'working capital'....Does this represent a cash inflow or a cash outflow? Provide an example and explain your rationale.
How does depreciation expense affect the level of cash flows when analyzing a project?
What are the disadvantages of using the payback period to evaluate an investment?
Under what circumstances would using the payback period to evaluate an investment be an appropriate one?
Given what you've learned in chapters 11 + 12, you are provided with several different methods under which you can evaluate an investment. If you were given the option of only using 2 of these methods to evaluate an investment decisions. Which two would you choose and why?