What is the difference between the initial cash flow and the purchase price of an asset?

Question

Quizplus · Accepted Answer

The initial cash flow includes the purchase price of an asset along with additional capital costs (such as installation costs) and net working capital. Option A only considers set up costs, while option B only considers capital costs, both of which are incomplete. Option D is incorrect as there is a definitive difference between the initial cash flow and the purchase price of an asset.

What Is the Difference Between the Initial Cash Flow and the Purchase