The course is based on the book Project Finance in Theory and Practice by Stefano Gatti, which is the primary source for the concepts tested.
A) $100 billion per year B) $500 billion per year C) $1 trillion per year D) $2 trillion per year
The project cannot cover its debt payments without drawing reserves Rationale: A DSCR < 1.0 means the project is technically insolvent for that period; it needs cash reserves or equity injections. The course is based on the book Project
Because infrastructure projects use highly leveraged capital structures (often 70% to 90% debt), calculating the correct WACC is vital for discounting future cash flows.
In a non-recourse project finance structure, lenders’ main recourse is to: In a non-recourse project finance structure, lenders’ main
Calculate the simplest Debt Service Coverage Ratio (DSCR). If an infrastructure project has Net Operating Income (NOI) of $150M and annual debt payments (principal + interest) of $100M, what is the DSCR?
Answer: d) All of the above
The asset being ready and available for use according to specified standards Rationale: Availability payments are used for social infrastructure where you can't charge users per use. The government pays a monthly fee if the asset works properly.
Measures the project's ability to pay its debt obligations with current operating cash flows. The government pays a monthly fee if the
: In project finance, all cash flows and liabilities are isolated within a Special Purpose Vehicle (SPV) .