California Coast University BAM513 Unit 3 Exam/California Coast University BAM513 Unit 3 Exam

Question

1) The first step in the capital budgeting process is

a. decision-making.

b. proposal generation.

c. implementation.

d. review and analysis.

2) All of the following are steps in the capital budgeting process EXCEPT

a. transformation.

b. decision-making.

c. implementation.

d. follow-up.

3) Cash flows that could be realized from the best alternative use of an owned asset are called

a. opportunity costs.

b. incremental costs.

c. lost resale opportunities.

d. sunk costs.

4) An important cash inflow in the analysis of initial cash flows for a replacement project is

a. installation cost.

b. the cost of the new asset.