Which of the following is considered to be an example of a side cost or benefit...

Which of the following is considered to be an example of a side cost or benefit for investment analysis?
1 Project Cannibalization
2 Project Synergies
3 Opportunity Costs

1 only
1 and 2 only
2 and 3 only
1,2 and 3

Which of the following statements is true about side projects?
1 Opportunity costs are not considered relevant for cash flow analysis
2 Product cannibalization occurs when a project compromises the value created by another
3 Project synergies are commonly anticipated when one firm acquires another

1 only
1 and 2 only
2 and 3 only
1,2 and 3

Solutions

Expert Solution

Which is the following is considered to be an example of a side cost or benefit for investment analysis?

1 Project Cannibalization

2 Project Synergies

3 Opportunity Costs

Ans: 1,2 and 3

These all determines the cash flows to be generated and hence is considered as side cost/benefit while investing

Which of the following statements ir true about side projects?

2 Product cannibalization occurs when a project compromises the value created by another

3 Project synergies are commonly anticipated when one firm acquires another

Ans : 2 and 3 only

Opportunity costs are considered relevant for cash flow analysis. Hence, the above statement is not true

jeff jeffy answered 1 year ago

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