Which of the Following Should Be Considered When a Company

question 29

Multiple Choice

Which of the following should be considered when a company estimates the cash flows used to analyze a proposed project?

• A) The new project is expected to reduce sales of one of the company's existing products by 5%.
• B) Since the firm's director of capital budgeting spent some of her time last year to evaluate the new project,a portion of her salary for that year should be charged to the project's initial cost.
• C) The company has spent and expensed $1 million on research and development costs associated with the new project.
• D) The company spent and expensed $10 million on a marketing study before its current analysis regarding whether to accept or reject the project.
• E) The firm would borrow all the money used to finance the new project,and the interest on this debt would be $1.5 million per year.

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Definitions:

Sociologists

Scholars and practitioners who study the development, structure, and functioning of human society, including the complex interactions and relationships within it.

Signs

Symbols that stand for or convey an idea.

Symbolic Culture

The aspect of culture that includes nonmaterial cultural elements such as beliefs, practices, values, and symbols that have meaning and significance in society.

Material Culture

The physical objects, resources, and spaces that people use to define their culture, including buildings, artwork, tools, and clothing.