Q: Should overhead expense ever be considered when evaluating investment cash flows?
Should overhead expense ever be considered when evaluating investment cash flows?
See AnswerQ: What are opportunity costs, and how should they affect an investment’s
What are opportunity costs, and how should they affect an investment’s cash flows? Give an example.
See AnswerQ: Should anticipated inflation be incorporated into project cash flow forecasts? If
Should anticipated inflation be incorporated into project cash flow forecasts? If so, how?
See AnswerQ: When McDonald’s moved into India, it faced a particularly difficult task
When McDonald’s moved into India, it faced a particularly difficult task. The major religion in India is the Hindu religion, and Hindus don’t eat beef—in fact, most of the 1 billion people living in I...
See AnswerQ: In Finance in a Flat World: Entering New Markets on page
In Finance in a Flat World: Entering New Markets on page 390, we described the importance of thinking globally when making investments. Pick a new product that you have just learned about that is bein...
See AnswerQ: For years, GM treated each car brand as if it were
For years, GM treated each car brand as if it were a separate company, considering all new car sales as incremental sales. Critically evaluate this position.
See AnswerQ: Throughout the examples in this chapter, we have assumed that the
Throughout the examples in this chapter, we have assumed that the initial investment in working capital is later recaptured when the project ends. Is this a realistic assumption? Do firms always recov...
See AnswerQ: In Regardless of Your Major: The Internet on Airline Flights—
In Regardless of Your Major: The Internet on Airline Flights—Making It Happen on page 374, we described an investment proposal involving the sale of internet services on airlines. How would you approa...
See AnswerQ: You are considering adding new elliptical trainers to your firm’s product line
You are considering adding new elliptical trainers to your firm’s product line of fitness equipment, and you feel you can sell 5,000 of these per year for five years (after which time this project is...
See AnswerQ: Corporate overhead expenses related to utilities and other corporate expenses are generally
Corporate overhead expenses related to utilities and other corporate expenses are generally not relevant to the analysis of new investment opportunities. Why?
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