If a Firm Pays Taxes,which One of These Will Reduce

question 64

Multiple Choice

If a firm pays taxes,which one of these will reduce net income but increase cash flow?

• A) Depreciation expense
• B) Income taxes
• C) Cash sales
• D) Interest expense

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Definitions:

Functional Fixedness

A cognitive bias that limits a person to using an object only in the way it is traditionally used, hindering problem-solving and creativity.

Mental Set

A psychological tendency to approach problems in a certain way due to past experiences and what has worked previously.

Heuristic Reasoning

A method of problem-solving based on practical, experiential approaches and shortcuts rather than systematic logic.

Evolutionary Processes

Natural mechanisms that drive the genetic changes in populations over time, leading to species adaptation and evolution.