Evaluating a New Project, Firms Should Include in the Projected

question 49

Multiple Choice

evaluating a new project, firms should include in the projected cash flows all of the following EXCEPT:

• A)Changes in net working capital attributable to the project.
• B)Previous expenditures associated with a market test to determine the feasibility of the project, provided those costs have been expensed for tax purposes.
• C)The value of a building owned by the firm that will be used for this project.
• D)A decline in the sales of an existing product, provided that decline is directly attributable to this project.
• E)The salvage value of assets used for the project that will be recovered at the end of the project's life.

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Definitions:

Cognitive Development

The process of growth and change in intellectual/mental abilities such as thinking, reasoning, and understanding over the course of a lifespan.

Forties

A term often referring to the decade of a person's life from age 40 to 49, or to the 1940s era in a century.

Seventies

A period referring to the decade between 1970 and 1979, often noted for its significant cultural, political, and technological changes.

Recognition Memory

A component of memory that allows an individual to identify previously encountered events, objects, or people.