Long-Term Decisions, Including Capital Budgeting Decisions, Involve Outflows of Cash

Essay

Long-term decisions, including capital budgeting decisions, involve outflows of cash at one time or more and inflows of cash at other times.Managers must decide whether the inflows justify the outflows.
Required:
a.List three examples of cash inflows and three examples of cash outflows that might be involved in making a capital budgeting decision.
b.Many capital budgeting decisions are made using present value calculations.What three factors does present value depend on?