Which of the Following Best Explains Why Is It Sensible

question 36

Multiple Choice

Which of the following best explains why is it sensible for a firm to use an accelerated depreciation schedule such as MACRS rather than straight-line depreciation?

• A) The firm will substantially decrease its depreciation tax shield across all of the depreciation timeline.
• B) The firm can decide over how many years an item may be depreciated, thus allowing it full control of its depreciation expenses.
• C) The firm will have substantially fewer depreciation expenses later in the depreciation timeline.
• D) The firm will receive greater benefits to its cash flow earlier in the depreciation timeline and thus increase net present value (NPV).

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Definitions:

Freud

Sigmund Freud was an Austrian neurologist and the founder of psychoanalysis, a method for treating psychopathology through dialogue between a patient and a psychoanalyst.

Hypnotic Suggestion

A method used in hypnotherapy whereby the therapist suggests certain perceptions, feelings, thoughts, or behaviors to the patient under hypnosis to alter their subconscious motivations or behaviors.

Trait Called Absorption

A personality characteristic where individuals become fully immersed and absorbed in their activities or experiences.