Use the Information for the Question(s)below

question 89

Multiple Choice

Use the information for the question(s) below.
The Sisyphean Corporation is considering investing in a new cane manufacturing machine that has an estimated life of three years. The cost of the machine is $30 000 and the machine will be depreciated by the straight-line method over its three-year life to a residual value of $0.
The cane manufacturing machine will result in sales of 2 000 canes in year 1. Sales are estimated to grow by 10% per year for each of the three years. The price per cane that Sisyphean will charge its customers is $18 each and is to remain constant. The canes have a cost per unit to manufacture of $9 each.
Installation of the machine and the resulting increase in manufacturing capacity will require an increase in various net working capital accounts. It is estimated that the Sisyphean Corporation needs to hold 2% of its annual sales in cash, 4% of its annual sales in accounts receivable, 9% of its annual sales in inventory, and 5% of its annual sales in accounts payable. The firm is in the 30% tax bracket and has a cost of capital of 10%.
-Which of the following is an example of 'cannibalisation'?

• A)A grocery store begins selling T-shirts featuring the local university's logo.
• B)A football manufacturer adds football boots to its product line.
• C)A newsagent begins selling prepaid mobile phones.
• D)A toothpaste manufacturer adds a new line of toothpaste (that contains baking soda)to its product line.

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Definitions:

Mood

A psychological state that can affect perception, behavior, and physical well-being.

Autonomy

The capacity and right of individuals to make their own choices and decisions, free from coercion or external influence.

Moral Principles

Fundamental beliefs about what is right and wrong or good and bad behavior.

Beneficence

The principle of doing good and preventing harm, often discussed as an ethical foundation in medicine and healthcare.