1. Define Capital Budgeting in not more than 2 sentences. 2. Define Capital Investments of a company. Should all anticipated cash coming into or going out of the firm as a result of capital budgeting decisions? Explain. 3. What is Depreciation? Define with an example. 4. Does Depreciation increase taxable income? Explain. 5. During Calculation of cash flows adding depreciation to net income is not involved at all. Is it true o false? Explain why. 6. If a project's cash flows are discounted at the internal rate of return. What will be the NPV? 7. An increase in an asset is a source of funds. True or False? Why? 8. Depreciation is a use of funds. True or False? Why? 9. The book value of a firm and the market value of a firm are generally identical. True or False? 10. The yield on common stock comes from two sources. Name them. 11. Finding the present value is simply the reverse of compounding. True or False? 12. A security is an instrument that represents a financial liability to the holder and a financial asset to the issuer. Mention True or False and explain why? 13. What is Secondary MARKET? wHAT IS THE "NEW ISSUE MARKET" -where first - time security issues are offered for sale - called?
