True or false

When undertaking large-scale investment projects, the two questions that managers have to answer are (1) is the project a good one and (2) will the costs of the investments be covered by equity, debt, or both?

True

False

Where the responsibility rests for deciding whether to undertake a new investment often depends on the cost of the investment.

True

False

If a firm has unlimited funds to invest in capital assets, all independent projects that meet its minimum investment criteria should be implemented.

True

False

In capital budgeting, the preferred approaches in assessing whether a project is acceptable are those that account for the timing and risk of a project's cash flows.

True

False

For projects with cash outflows up front and cash inflows later on, ignoring the time value of money would lead companies to understate the value of investment projects and therefore decline to make investments that they should in fact pursue.

True

False

If an investment costs more than it is worth then it will reduce the value of the firm.

True

False