NPV East Indonesia

Which one these following statement is not correct?

• Present value is what the future value is worth today

• Compounding interest is the discount rate

• Future value is the value of future cash flows

• Time value of money – a dollar today is worth more than a dollar tomorrow

The value of future cash flow depends on these components, except…

• Foreign exchange rate

• Timing of cash flow

• Opportunity cost of capital

• Certainty of cash flow

What is the Discounted Cash Flow (DCF)?

• Present value of single future cash flow

• Present value of many future cash flows

• Present value of receiving

• Present value of investing

These following financial terms are using as interest rate, except…

• Discount rate

• Hurdle rate

• Cost of capital

• Inflation rate

What is the Net Present Value (NPV)?

• Present value of many future cash flows

• The average of the cost of equity and the cost of debt

• The difference between the PV of future cash inflows and the PV of future cash outflows over a period time.

• The absolute value created by a project or business

If you have $100 today and could invest it at 10% compounded interest per year, how much is worth in 5 years?

• $100

• $500

• $201

• $68

These following components are Free Cash Flow structures, except…

• Delta in Working Capital

• Costs

• Capex

• Interest expenses

Which common financial matric is closest to free cash flow?

• NPAT

• EBITDA

• EBIT

• Operating cash flow + Investing cash flow

Which one these following statement is correct in doing sensitivity analysis of NPV?

• You can identify the critical variable and to increase the understanding of the risk associated

• You cannot include business judgment in the sensitivity analysis

• You can predict the outcome of decision based on a certain range of variables

• You can improve the precision of the NPV by refining assumptions which drive sensitivity