Free Cash Flow Multiple Choice Questions with Answers – PDF Download

MCQ 1: The relevant cash flow which company expects when it implements the project is classified as:

1. irrelevant cash flow
2. relevant cash flow
3. incremental cash flow
4. decrease cash flow

MCQ 2: An investment outlay cash flow is $4000, operating cash flow is $1000 and the salvage cash flow is $5000 then the free cash flow would be:

1. 10000
2. 8000
3. zero
4. 4000

MCQ 3: The net investment in operating capital is $7000 and the net operating profit after taxes is $11,000 then the free cash flow will be:

1. −$18000
2. 18000
3. −$4000
4. 4000

MCQ 4: The free cash flow is $15000 and the net investment in operating capital is $9000 then the net operating profit after taxes will be:

1. 24000
2. 6000
3. −$6000
4. −$24000

MCQ 5: An operating cash flows is $12000 and the gross fixed asset expenditure is $5000 then the free cash flow will be:

1. −$7000
2. 7000
3. 17000
4. −$17000