Question

We can identify the cash costs and cash inflows to a company that will result from a project. These could be called "direct inflows and outflows," and the net difference is the direct net cash flow. If there are other costs and benefits that do not flow from or to the firm, but to other parties, these are called externalities, and they need not be considered as a part of the capital budgeting analysis. True False

Answer 1

Answer:

The correct answer is :  False.

Explanation:

Capital budgeting refers to the planning process used to determine if the long term investments of an organization are worth the funding of cash through the firm's capitalization structure. This concept helps to creates accountability and measurability and to understand the risks and returns involved in the business.