Table 11.4 Computer Disk Duplicators, Inc. Has Been Considering Several Capital Investment

question 70

Multiple Choice

Table 11.4
Computer Disk Duplicators, Inc. has been considering several capital investment proposals for the year beginning in 2004. 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 1, the initial outlay equals ________. (See Table 11.4)

• A) $1,380,000
• B) $1,440,000
• C) $1,500,000
• D) $1,620,000

---

Definitions:

Perceived Behavioral Control

An individual's beliefs about their capability to perform a particular behavior or action.

Subjective Norms

Individual perceptions of social pressure to perform or not perform a particular behavior, which can influence their actions.

Health Benefits

Positive effects on physical and/or mental well-being obtained through activities, foods, practices, or medical treatments.

Transtheoretical Model

A model of behavior change that assesses an individual's readiness to act on a new healthier behavior and provides strategies to guide the individual through the stages of change to achieve it.