Financing And Investing In Infrastructure Coursera Quiz: Answers !!hot!!

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2. What is the primary objective of infrastructure portfolio management?

Key Concepts:

LLCR (Loan Life Coverage Ratio):

Assesses the project's ability to repay debt over the entire loan term. Study Resources Ready to create a quiz

• Cashflow forecasting: detailed year-by-year modeling of revenues, operating costs, capex, taxes, and working capital.
• Discounted cash flow (DCF): present value of expected free cash flows to equity or asset; discount rate reflects risk (WACC for asset valuation, higher for equity).
• Net present value (NPV), internal rate of return (IRR) for equity and project sponsors.
• Debt sizing and debt service coverage ratio (DSCR): key metrics to ensure cash available to meet debt service; typical covenants set minimum DSCRs (e.g., 1.2x–1.5x during operations).
• Sensitivity and scenario analysis: vary traffic, tariffs, operating costs, construction costs, interest rates.
• Real options: flexibility for expansion, timing, or abandonment can have material value in uncertain environments.
• Lifecycle costing and whole-life value analysis (especially in availability PPPs).

1. Which of the following types of infrastructure investments is characterized by a high degree of physical and economic specificity?

Week 4: Public-Private Partnerships

A) High returns B) Low volatility C) Diversification D) Liquidity What is the primary objective of infrastructure portfolio

• Special Purpose Vehicle (SPV) structure
• Non-recourse vs. limited recourse debt
• Debt service coverage ratio (DSCR) and loan life coverage ratio (LLCR)
• Cash flow waterfall