Cash Flow Analysis Multiple Choice Questions with Answers – PDF Download

MCQ 1: In cash flow analysis, the two projects are compared by using common life, is classified as:

1. transaction approach
2. replacement chain approach
3. common life approach
4. Both B and C

MCQ 2: The payback period in which an expected cash flows are discounted with the help of project cost of capital is classified as:

1. discounted payback period
2. discounted rate of return
3. discounted cash flows
4. discounted project cost

MCQ 3: In alternative investments, the constant cash flow stream is equal to initial cash flow stream in the approach which is classified as:

1. greater annual annuity method
2. equivalent annual annuity
3. lesser annual annuity method
4. zero annual annuity method

MCQ 4: The present value of future cash flows is $2000 and an initial cost is $1100 then the profitability index will be:

1. 0.55
2. 1.82
3. 0.55
4. 0.0182

MCQ 5: The cash flow which is available for all the investors of the company is classified as:

1. extrinsic stock
2. intrinsic stock
3. investing cash
4. free cash flow