1. Which of the following costs would have hidden quality costs?
a) Appraisal costs
b) Internal failure costs
c) External failure costs
d) Both B and C
2 . Investment in additional working capital for a project assumes:
a. investment in year zero
b. full recovery in the final year
c. investment in year zero AND full recovery in the final year
d. depreciation over the life of the project
3. What is the quantitative decision rule for the internal rate of return method?
a. Accept investments whose return on investment exceeds the accounting rate of return.
b. Accept investments whose weighted average cost of capital exceeds the return on investment.
c. Accept investments whose required rate of return exceeds the internal rate of return.
d. Accept investments whose internal rate of return exceeds the required rate of return.