The key inputs into a discounted cash ﬂow analysis are the projected:
A) Net income amounts for each year of the project.
B) Cash ﬂows for each period of time.
C) Sales and opportunity costs for each year of the project.
D) Initial costs and related depreciation expenses.
E) Changes in net income resulting from accepting a project.

Question

Quizplus · Accepted Answer

The key inputs into a discounted cash flow analysis are the projected cash flows for each period of time, not just net income or sales. Depreciation expenses and initial costs are also important inputs but are not the only ones. Changes in net income resulting from accepting a project are not an input, but rather the outcome of the analysis.

The Key Inputs into a Discounted Cash ﬂOw Analysis Are