Question

1.Before making a project investment, you should understand the time value of money concept. Assume that you received RM 1,000 exactly a year ago. You saved the money. Now, you notice that your RM 1,000 has less buying power than it did a year ago. What caused the decline in your value of money?

A. Tax rate B. Inflation C. Salvage value D. Risk of cash flow

2.When a project intends to change its existing assets with new assets, this investment decision is classified as:

A. Internal Projects B. Replacement project C. New projects D.

3.Existing Projects An investment project involves cash flow analysis and, in this analysis, depreciation is considered as:

A. Cash item. B. Cash flow discount. C. Non-cash item. D. Salvage discount.

4.Time value of money considerations is an important analytical tool in long term investment. Thus, by understanding the time value of money concept, it reflects that:

A. it is better to receive RM 101 a year from now than RM 100 today. B. saving money can ensure on time debt payment. C. it is better to receive RM 100 today than RM 101 a year from now. D. time and money are related by due date.

5.What is one of the main purposes of a project's sales and costs budget?

A. To determine cash inflow B. To forecast trends C. To predict the economy D. To track the competition Investment in engineering projects involve the consideration of internationalization.

6.Managers can reasonably compare different investment alternatives within and across countries to make informed decisions. A benefit of informed decisions is that they

A. reduce a project's risk. B. are usually quick decisions. C. cost less money. D. influence a business's chances at competing.

Answer 1

1.Before making a project investment, you should understand the time value of money concept. Assume that you received RM 1,000 exactly a year ago. You saved the money. Now, you notice that your RM 1,000 has less buying power than it did a year ago. What caused the decline in your value of money?

B. Inflation

2.When a project intends to change its existing assets with new assets, this investment decision is classified as:

B. Replacement project

3. An investment project involves cash flow analysis and, in this analysis, depreciation is considered as:

C. Non-cash item.

4.Time value of money considerations is an important analytical tool in long term investment. Thus, by understanding the time value of money concept, it reflects that:

C. it is better to receive RM 100 today than RM 101 a year from now.

5.What is one of the main purposes of a project's sales and costs budget?

A. To determine cash inflow

6.Managers can reasonably compare different investment alternatives within and across countries to make informed decisions. A benefit of informed decisions is that they

A. reduce a project's risk.