1. The flow-to-equity (FTE) approach in capital budgeting is defined to be the:
a. Discounting all cash flows from a project at the overall cost of capital.
b. Scale enhancing discount process.
c. Discounting of the levered cash flows to the equity holders for a project at the required return on equity.
d. Dividends and capital gains that may flow to a shareholders of any firm.
e. Discounting of the unlevered cash flows of a project from a levered firm at the WACC.
2. The acronym APV stands for:
a. Applied present value.
b. All purpose variable.
c. Accepted project verified.
d. Adjusted present value.
e. Applied projected value.