Which of the following is not a good assumption to identify relevant cash flows?A new long-term investment project should “stand on its own feet” and be viewed as a “mini firm”Sunk costs and financial costs should not be includedOpportunity costs that can be attributed to the project should be includedOverhead costs that remain fixed should be allocatedChanges in working capital should be included

Which of the following may not generally result in underestimation of project cash flows?(1 Point)Under estimation of project cost of capitalUnder estimation of salvage valuesIgnoring intangible benefitsOverlooking the value of future options

Which of the following is not a relevant cash flow?Initial investmentWorking capitalSunk costsAfter-Tax Operating incomeDepreciation tax savings

Which of the following statements is FALSE?Group of answer choicesAs a practical matter, to derive the forecasted cash flows of a project, financial managers often begin by forecasting earnings.When evaluating a capital budgeting decision, we generally include interest expense.The decision to continue or abandon a project should be based only on the incremental costs and benefits of the project going forward.Earnings are not cash flows.

he profitability of an investment project is determined by evaluating its ……………None of the above.Cash outflow Cash flowsCash inflow

In estimating "after-tax incremental operating cash flows" for a project, you should include all of the following EXCEPT:Select one:a. changes in working capital resulting from the project, net of spontaneous changes in current liabilities.b. sunk costs.c. effects of inflationd. opportunity costs.