P2 Exam Dumps : Advanced Management Accounting

It adjusts the relevant cash flows of a project to reflect the time value of money. The discount rate used is always the company's weighted average cost of capital.

It adjusts the relevant cash flows of a project to reflect the time value of money. The discount rate used reflects the risk of the project.

It adjusts the relevant profits of a project to reflect the time value of money. The discount rate used reflects the risk of the project.

It adjusts the relevant cash flows of a project after the deduction of depreciation charges to reflect the time value of money. The discount rate used is always the company's weighted average cost of capital.

1 + money rate = (1 + real rate) x (1 + inflation rate)

1 + real rate = (1 + money rate) / (1 + inflation rate)

1 + real rate = (1 + inflation rate) / (1 + money rate)

1 + money rate = (1 + inflation rate) / (1 + real rate)

1 + inflation rate = (1 + money rate) x (1 + real rate)

It is worthwhile for a company to sell further units when the marginal revenue is greater than the marginal cost.

Price is the only factor affecting the demand for products and services.

Premium pricing is possible when there is a measure of product or service differentiation.

Loss leadership pricing is appropriate for a new product which is not part of a range of products.

Demand functions can be predicted accurately and the relationship between price and quantity demanded is always constant.