According to the Incremental Cash Flow Principle, the Firm Should

question 189

Multiple Choice

According to the incremental cash flow principle, the firm should include:

• A)taxes.
• B)interest.
• C)dividends.
• D)a and b
• E)a, b, and c

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Definitions:

Diminishing Marginal Utility

The principle that as a person increases consumption of a product, there is a decline in the marginal utility that person derives from consuming each additional unit of that product.

Utility Schedule

A table or graph that displays an individual's or group's satisfaction or utility levels derived from consuming different amounts of a good or service.

Candy Bars

Confectioneries usually consisting of some type of chocolate and other additives like nuts, caramel, nougat, or wafers, marketed as snacks or desserts.

Marginal Utility

The increased gratification obtained by a consumer from the consumption of one more unit of a good or service.