Which of the Following Is NOT a Component of the Expected

question 86

Multiple Choice

Which of the following is NOT a component of the expected annual after-tax cash flows?

• A)The additional depreciation expense that results from the capital cost of the investment.
• B)The additional taxes paid that result from the capital budgeting decision.
• C)The incremental increase in after-tax operating income of the project.
• D)The incremental tax savings that result from the initial investment outlay.

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Definitions:

Placebo

An inert or non-therapeutic substance given to a control group in clinical trials to assess the psychological impact of receiving a treatment.

Natural

Naturally occurring and not manufactured or created by human beings.

Biased

Showing an unfair preference or prejudice for or against something or someone.

Internal Validity

The extent to which a study can demonstrate a cause-and-effect relationship between its variables.