Motivations for counter party to enter into currency swap

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Reference no: EM132044599

1. Which of the following statements is most correct?

A) Corporations should include not sunk costs when making investment decisions

B) Corporations should include opportunity costs when making investment decisions.

C) Since depreciation is not a cash expense, it does not affect operating cash flows.

D) All of the answers above are correct.

E) Answers (A) and (B) are correct.

2. A Company has projected operating profit (EBIT) of $500,000, depreciation of $100,400, interest expense of $10,000 and a tax rate of 35%. What is the operating cash flow?

3. Discuss the basic motivations for a counterparty to enter into a currency swap. You must include comparative advantage in your discussion.

Reference no: EM132044599

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