9.1. c. 9. Place the correct letter answer in the box to the left of the question 2 points each - 20 total points. A company has a current ratio below 1.00, which of the following statements must be true? a. The company is a credit risk. b. Its net working capital is negative. c. Its receivables are less than its inventories. d. Short-term liabilities must exceed long-term liabilities. 9.2. A corporation with the following tumovers has operating and cash cycles of which length of time? Inventory turnover of 5.48 times per year Receivables turnover of 9.68 times per year Payables tumover of 10.25 times per year a. 15.2 days and 4.9 days b. 73.3 days and 6.7 days 102.2 days and 64.5 days d. 104.3 days and 68.7 days Which one of the following will be useful to decrease the cash cycle? Collect from customers sooner. 6. Carry less in finished goods inventory. C. Extend the time for payments to suppliers. d. All of the above. e. Answers b. and c. Which business driver does DuPont analysis not consider? a. Efficiency b. Growth. c. Effectiveness. d. Leverage. 9.5. If a project is assigned a required rate of return of zero, then: a. The project will always be accepted. 6. The timing of the project's cash flows has no bearing on the value of the project. The project will always be rejected. d. Whether the project is accepted or rejected will depend on the timing of the cash flows. e. The project can never add value for the shareholders. 9.3. a. 9.4. C. 9.6. A project that costs $839 and has cash inflows of $181 per year for five years has a payback period of a. 2.63 years b. 3.63 years C. 4.63 years d. Never 9.7. A decrease in which metric indicates a strength over time: a. Market to book 6. COGS as a % of sales. c. Inventory turnover. d. Both a. and b. 9.8. True (T) or False (F). As the discount rate increases, the value of the project falls. 9.9 No matter how many forms of investment analysis you employ: a. the actual results from a project may vary significantly from the expected results. b. the internal rate of return will always produce the most reliable results. c. a project will never be accepted unless the payback period is met. d the initial costs will generally vary considerably from the estimated costs. e. only the first three years of a project ever affect its final outcome. 19.10 Accepting a positive net present value (NPV) project: a indicates the project will pay back within the required period of time. b. means the present value of the expected cash flows is equal to the project's cost. c. ignores the inherent risks within the project. d. guarantees all cash flow assumptions will be realized. is expected to increase the stockholders' value by the amount of the NPV. e