Question

In cash flow estimation, the existence of externalities should be taken into account if those externalities have any effects on the firm's long-run cash flows.

Answer 1

True In cash flow estimation, the existence of externalities should be taken into account if those externalities have any effects on the firm's long-run cash flows

What is cash flow?

A cash flow is a physical or virtual movement of money: a cash flow in its most limited sense is a payment, particularly from one central bank account to another.

A cash flow statement is divided into three sections: operating activities, investments, and financial activities.

Cash flow from assets is the sum of all cash flows related to a company's assets. This data is used to calculate the net amount of cash generated by or used in the operations of a business.

Companies should track and analyze three types of cash flows to determine the liquidity and solvency of their business: cash flow from operating activities, cash flow from investing activities, and cash flow from financing activities.

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