Question: Question 3 - A. When calculating FCF, why do we subtract depreciation before tax and then add it back on after? Why are we concerned

Question 3 -

A. When calculating FCF, why do we subtract depreciation before tax and then add it back on after? Why are we concerned with cash flows and not profit? (200 Words) (5 Marks)

B. What is the difference between sensitivity analysis and scenario analysis? Which do you believe is more important for your decision of whether to go ahead with a project? (200 Words) (5 Marks)

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