1. Which of the following statements is FALSE?

A. The terminal of continuation value of the project represents the market value (as of the last forecast period) of the free cash flow from the project at all future dates.

B. The incremental effect of a project on the firm's available cash is the project's free cash flow.

C. (1 - τc) × Depreciation is called the depreciation tax shield.

D. To evaluate a capital budgeting decision, we must determine its consequences for the firm's available cash.

2. The international monetary fund:

a. in recent years had provided loans to Russia, South Korea, and Brazil.

b. was created as a result of the brenton woods agreement

c. aids countries with balance of payment and exchange rate problems.

d. all of above