For Example, in the Case of an Electric Car Project

question 62

Multiple Choice

For example, in the case of an electric car project, which of the following cash flows should be treated as incremental flows when deciding whether to go ahead with the project?

• A) The cost of research and development undertaken for developing the electric car in the past three years
• B) The annual depreciation charge
• C) Tax savings resulting from the depreciation charges
• D) Dividend payments

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Definitions:

Conscious Processing

The mental activities that involve awareness and attention in the processing of information.

Unconscious Processing

The mental activities of which individuals are not aware but that influence emotions, judgments, and behaviors.

Insomnia

A sleep disorder characterized by difficulty falling asleep, staying asleep, or obtaining restorative sleep, leading to daytime impairment.

Overestimate

To assess a value or number as greater than it actually is.