Short Writing Assignment Financing Costs Your book says that cost of financing a

Question

Short Writing Assignment Financing Costs Your book says that cost of financing a project are not relevant cash flows for the purposes of evaluating whether a project is worth taking or not. Objective Students are expected to argue in favor of positions they may not necessarily agree with, and in the process, learn to understand where opposing views come from. Such skills are necessary to stay away from "incestuous amplification" that arises from groups of people who think alike. You are required to defend the that claim. WRITE AS A SHORT ESSAY

Explanation / Answer

Cost of financing project are relevant cash flow as per my view. This is because without incurring such cost project can not be started . Lets say loan taken to purchase machine is relevant cash flow. Now when loan is taken interest has to be paid on it. Such interest arisies only because project is undertaken. If project is not undertaken than there would be no finance cost. Thus there is direct link between cost of financing project and relevant cash flow.

Related Questions

Navigate

• Browse (All)
• Browse S
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.