Which of the Following Is an Example of a Sunk

question 132

Multiple Choice

Which of the following is an example of a sunk cost in a capital budgeting decision regarding the purchase of new equipment for a profitable business that pays taxes?

• A)The disposal of the equipment to be replaced.
• B)The purchase price of the equipment to be replaced.
• C)The additional working capital requirement.
• D)The operating cost of the new equipment.

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Definitions:

ADP

Adenosine diphosphate, a molecule involved in ATP synthesis, it releases energy when it is converted to ATP in cellular respiration.

Muscle Contraction

The tightening of muscle fibers initiated by electrical impulses, leading to shortening of the muscle and movement or force generation.

Sarcoplasmic Reticulum

Smooth endoplasmic reticulum of skeletal muscle cells; surrounds the myofibrils and stores calcium ions.

Calcium Ions

Electrically charged calcium atoms (Ca2+) that play a crucial role in various physiological processes, including muscle contraction, neurotransmitter release, and bone formation.