For purposes of international capital budgeting, it is NOT important to distinguish between parent and total project cash flows.

Question

Quizplus · Accepted Answer

It is important to distinguish between parent and total project cash flows in international capital budgeting because the parent cash flows only represent the cash flows attributable to the parent company, while total project cash flows represent the cash flows of the entire project including any cash flows that may be generated by the subsidiary or foreign affiliate. This distinction is important because it affects how the cash flows are measured and evaluated for investment decisions.

For Purposes of International Capital Budgeting, It Is NOT Important