All of the Following Are Anticipated Effects of a Proposed

question 40

Multiple Choice

All of the following are anticipated effects of a proposed project.Which of these should be included in the initial project cash flow related to net working capital?
I.an inventory decrease of $5,000
II.an increase in accounts receivable of $1,500
III.an increase in fixed assets of $7,600
IV.a decrease in accounts payable of $2,100

• A)I and II only
• B)I and III only
• C)II and IV only
• D)I, II, and IV only
• E)I, II, III, and IV

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Definitions:

Price-Taker Market

A market condition in which individual buyers or sellers cannot influence the market price through their own actions.

Economic Profit

The difference between total revenue and total costs, including both explicit and implicit costs, reflecting the true profitability of a firm's operations.

Demand Increase

A situation where there is a rise in consumer desire to purchase goods or services, leading to higher quantities demanded at the same price levels.

Economic Profits

The difference between total revenue and total costs, including both explicit and implicit costs, indicating the profitability of a firm beyond normal returns.