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Table 11.2 Computer Disk Duplicators, Inc. Has Been Considering Several Capital Investment

question 33

Multiple Choice

Table 11.2
Computer Disk Duplicators, Inc. has been considering several capital investment proposals for the year beginning in 2014. For each investment proposal, the relevant cash flows and other relevant financial data are summarized in the table below. In the case of a replacement decision, the total installed cost of the equipment will be partially offset by the sale of existing equipment. The firm is subject to a 40 percent tax rate on ordinary income and on long-term capital gains. The firm's cost of capital is 15 percent.
________________________________________________________ *Not applicable
-For Proposal 3, the cash flow pattern for the replacement project is ________. (See Table 11.2)

Definitions:

Reaction Formation

This defense mechanism involves the disguising of one's own threatening impulses by attributing them to others in an exaggerated or opposite form, as a means of coping with anxiety.

Exaggerated Emotions

Intensified feelings that are often disproportionate to the situation, sometimes due to stress, personality traits, or psychological conditions.

Repression

A psychological defense mechanism where distressing thoughts and memories are unconsciously blocked from conscious awareness.

Displacement

In psychology, a defense mechanism involving the redirection of an impulse from a real target to a safer or substitute one.