Which of the Following Best Defines Incremental Earnings

question 84

Multiple Choice

Which of the following best defines incremental earnings?

• A)cash flows arising from a particular investment decision
• B)the amount by which a firm's earnings are expected to change as the result of an investment decision
• C)the earnings arising from all projects that a company plans to undertake in a fixed timespan
• D)the net present value (NPV)of earnings that a firm is expected to receive as the result of an investment decision
• E)the increase in cash flows resulting from a new product

---

Definitions:

Habituation

The process of becoming accustomed to a stimulus or environment over time, resulting in a decrease in response.

Stimulus

Something that incites or provokes a physiological or psychological action or response.

Decreased Responsiveness

A reduction in the strength or frequency of a person's reactions to stimuli, which can be a sign of various physical or psychological conditions.

Snellan Chart

A visual tool consisting of lines of letters in decreasing size used to test visual acuity from a specific distance.