Final answer:
Capital budgeting models indeed rely on the measurement of cash flows into and out of the firm to assess the viability of investments, which is true. Techniques like NPV and IRR are key for this analysis.
Step-by-step explanation:
The statement that capital budgeting models rely on measures of cash flows into and out of the firm is true. Capital budgeting is a process that businesses use to evaluate potential major projects or investments. It involves the estimation of the cash inflows and outflows to determine the financial viability of a proposed investment over time. Key techniques in capital budgeting include Net Present Value (NPV), Internal Rate of Return (IRR), Payback Period, and Profitability Index (PI), all of which are based on the concept of cash flow analysis.