Which One of the Following Would NOT Result in Incremental

question 32

Multiple Choice

Which one of the following would NOT result in incremental cash flows and thus should NOT be included in the capital budgeting analysis for a new product?

• A) A firm has a parcel of land that can be used for a new plant site or be sold,rented,or used for agricultural purposes.
• B) A new product will generate new sales,but some of those new sales will be from customers who switch from one of the firm's current products.
• C) A firm must obtain new equipment for the project,and $1 million is required for shipping and installing the new machinery.
• D) A firm has spent $2 million on research and development associated with a new product.These costs have been expensed for tax purposes,and they cannot be recovered regardless of whether the new project is accepted or rejected.
• E) A firm can produce a new product,and the existence of that product will stimulate sales of some of the firm's other products.

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Definitions:

DSM

Short for Diagnostic and Statistical Manual of Mental Disorders, a handbook used by healthcare professionals as the authoritative guide to the diagnosis of mental disorders.

Overdiagnosis

The diagnosis of a disease or condition that is unlikely to cause harm during a person's lifetime, leading to unnecessary treatment.

Diagnostic Labels

Terms used to categorize and describe symptoms that cluster together, aiding in the identification and treatment of mental health and medical conditions.

Objectivity

The practice of basing conclusions and decisions on observable phenomena, uninfluenced by emotions or personal biases.