Use the Information for the Question(s)below

question 22

Multiple Choice

Use the information for the question(s) below.
Epiphany Industries is considering a new capital budgeting project that will last for three years. Epiphany plans on using a cost of capital of 12% to evaluate this project. Based on extensive research, it has prepared the following incremental cash flow projects:

-The free cash flow for the last year of Epiphany's project is closest to:

• A)$47 750
• B)$62 750
• C)$39 000
• D)$45 000

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Definitions:

Statistical Validity

The extent to which the statistical conclusions drawn from a study are accurate and reliable.

Scale Construction

The process of developing a tool or instrument for measuring variables, typically involving item generation and validation.

Randomness

A principle in which individual outcomes or events are unpredictable, but the statistical distribution of outcomes over many repetitions will show a specific pattern.

Scale Items

Individual questions or statements in a survey or questionnaire that are scored to measure a particular construct or variable.