The Question of Economic Feasibility Is Important When Designing and Implementing

question 35

Multiple Choice

The question of economic feasibility is important when designing and implementing a new system.Accountants can contribute to feasibility study analysis by evaluating cost savings and other benefits versus operating costs and other cash outflows.This is better known as

• A)the "best guess" model of benefit analysis.
• B)the "value added" benefit model.
• C)the capital budgeting model.
• D)the estimated benefits model.

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Definitions:

Tax Revenue

The income generated by the government through the imposition of taxes on goods, services, income, and transactions.

Opportunity Costs

The cost of the next best alternative foregone when a decision is made to choose one option over another.

Tax

Mandatory financial charges imposed by a government on individuals and organizations to fund public expenditures.

Market Price

The current price at which a good or service can be bought or sold, determined by the balance of supply and demand in the market.