Final answer:
The false statement about cash flow diagramming is that it does not consider the magnitude of cash flows; in fact, cash flow diagrams do show the magnitude and timing which is crucial for financial management and project planning.
Step-by-step explanation:
The statement about cash flow diagramming that is false is: c) It does not consider the magnitude of cash flows. Cash flow diagramming is a visual representation tool that indeed considers the magnitude of cash flows, along with the timing of when these flows occur.
It is essential for effective project planning and analysis in financial management because it allows individuals and businesses to more easily visualize when money will be expended and when income is expected.
This visualization aids in understanding the impact of time on the money's value and in decision-making processes for investments or project management.