Use the Information for the Question(s)below

question 44

Multiple Choice

Use the information for the question(s) below.
Epiphany Industries is considering a new capital budgeting project that will last for three years.Epiphany plans on using a cost of capital of 12% to evaluate this project.Based on extensive research,it has prepared the following incremental cash flow projects:

-The free cash flow for the last year of Epiphany's project is closest to:

• A)$48,123
• B)$35,532
• C)$32,225
• D)$43,000
• E)$34,253

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Definitions:

Externality Hypothesis

A theory suggesting that individuals attribute their own behavior to external factors and circumstances beyond their control.

Homeostasis

The regulatory process by which biological systems tend to maintain stability while adjusting to conditions that are optimal for survival.

Overjustification Effect

The phenomenon where providing excessive external rewards for an already internally rewarding activity leads to a decrease in intrinsic motivation.

Overjustification Effect

The phenomenon in which rewarding a person for performing an activity actually decreases their intrinsic motivation to perform that activity.