QUESTION 1

1. The appropriate decision rule when calculating the NPV for the equity investor is that if the number is negative it is a good investment since the cash flows are being discounted at the investor's WACC.

   True

   False

QUESTION 2

1. XIRR and XNPV should be used when projects have intermittent cash flows and/or cash flows that extend for very long periods of time

   True

   False

QUESTION 3

1. A lower going in cap rate means the investor should expect less cash flows from operations and should expect to make most of their returns from the future equity reversion as opposed to a higher cap rate which indicates that the bulk of the returns will be made from the yearly cash flows.

   True

   False

QUESTION 4

1. Calculating the NPV using the WACC produces a percentage yield similar to the Equity dividend rate and IRR for the equity investor.

   True

   False

QUESTION 5

1. In the valuation of a real estate investment the last cash flow consists of two parts: Cash Flow from Operation plus Cash Flow from Sale.

   True

   False