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21.
The base case values used in scenario analysis are the ones considered the
most:
22.
Which of the following variables will be at their highest expected level under
a worst case scenario?
I. fixed cost
II. sales price
III. variable cost
IV. sales quantity
23.
When you assign the lowest anticipated sales price and the highest
anticipated costs to a project, you are analyzing the project under the
condition known as:
24.
Which one of the following statements concerning scenario analysis is
correct?
25.
Sensitivity analysis determines the:
26.
Assume you graph a project's net present value given various sales
quantities. Which one of the following is correct regarding the resulting
function?
27.
As the degree of sensitivity of a project to a single variable rises, the:
28.
Sensitivity analysis is based on:
29.
Which type of analysis identifies the variable, or variables, that are most
critical to the success of a particular project?
30.
Simulation analysis is based on assigning a _____ and analyzing the results.
31.
Which one of the following types of analysis is the most complex to
conduct?
32.
Ted is analyzing a project using simulation. His focus is limited to the short-
term. To ease the simulation process, he is combining expenses into various
categories. Which one of the following should he include in the fixed cost
category?
33.
Which one of the following statements concerning variable costs is correct?
34.
Which of the following are inversely related to variable costs per unit?
I. contribution margin per unit
II. number of units sold
III. operating cash flow per unit
IV. net profit per unit
35.
Steve, the sales manager for TL Products, wants to sponsor a one-week
"Customer Appreciation Sale" where the firm offers to sell additional units
of a product at the lowest price possible without negatively affecting the
firm's profits. Which one of the following represents the price that should be
charged for the additional units during this sale?
36.
The president of Global Wholesalers would like to offer special sale prices
to the firm's best customers under the following terms:
1. The prices will apply only to units purchased in excess of the quantity
normally purchased by a customer.
2. The units purchased must be paid for in cash at the time of sale.
3. The total quantity sold under these terms cannot exceed the excess
capacity of the firm.
4. The net profit of the firm should not be affected.
5. The prices will be in effect for one week only.
Given these conditions, the special sale price should be set equal to the:
37.
The contribution margin per unit is equal to the:
38.
Which of the following values will be equal to zero when a firm is producing
the accounting break-even level of output?
I. operating cash flow
II. internal rate of return
III. net income
IV. payback period
39.
An increase in which of the following will increase the accounting break-
even quantity? Assume straight-line depreciation is used.
I. annual salary for the firm's president
II. contribution margin per unit
III. cost of equipment required by a project
IV. variable cost per unit
40.
Webster Iron Works started a new project last year. As it turns out, the
project has been operating at its accounting break-even level of output and
is now expected to continue at that level over its lifetime. Given this, you
know that the project:
