Profitability Index Multiple Choice Questions (MCQ) PDF - 76

MCQ 376: The profitability index in capital budgeting is used for

1. negative projects
2. relative projects
3. evaluate projects
4. earned projects

MCQ 377: The net operating profit after taxes is $4500, the net investment in operating capital is $8500 and then the free cash flow would be

1. −$4000
2. 4000
3. −$18000
4. 18000

MCQ 378: A company that sells products to customer without demanding immediate payment but record it in balance sheet as

1. account payable
2. account receivable
3. account equivalent
4. account investment

MCQ 379: The third step in calculating value of stock with non-constant growth rate is to find

1. p.v of expected dividends
2. f.v of expected dividends
3. p.v of intrinsic rate
4. f.v of intrinsic rate

MCQ 380: The probability distribution is classified as normal if expected return lies between

1. ( + 1 and -1)
2. ( + 2 and -2)
3. ( + 3 and -3)
4. ( + 4 and -4)