Which of the following statements generally apply to

38. Which of the following statements generally apply to the cash flows of a financing type
project?
I. nonconventional cash flows
II. cash outflows exceed cash inflows prior to any time value adjustments
III. cash for services rendered is received prior to the cash that is spent providing the services
IV. the total of all cash flows must equal zero on an unadjusted basis
A. I only
B. I and III only
C. II and IV only
D. I, II, and III only
E. I, II, III, and IV
Refer to section 9.5
AACSB: N/A
Bloom's: Comprehension
Difficulty: Intermediate
Learning Objective: 9-5
Section: 9.5
Topic: Financing cash flows
9-65

Chapter 09 - Net Present Value and Other Investment Criteria
39. Which one of the following statements is correct in relation to independent projects?
Refer to section 9.5
AACSB: N/A
Bloom's: Comprehension
Difficulty: Intermediate
Learning Objective: 9-5
Section: 9.5
Topic: Financing cash flows
40. The profitability index is most closely related to which one of the following?
Refer to section 9.6
AACSB: N/A
Bloom's: Knowledge
Difficulty: Basic
Learning Objective: 9-7
Section: 9.6
Topic: Profitability index
9-66

Chapter 09 - Net Present Value and Other Investment Criteria
41. Roger's Meat Market is considering two independent projects. The profitability index
decision rule indicates that both projects should be accepted. This result most likely does
which one of the following?
Refer to section 9.6
AACSB: N/A
Bloom's: Comprehension
Difficulty: Basic
Learning Objective: 9-7
Section: 9.6
Topic: Profitability index