What Do Discounted Cash Flow Methods for Capital Budgeting Focus

question 119

Multiple Choice

What do discounted cash flow methods for capital budgeting focus on?

• A)Cash outflows
• B)Operating profit
• C)Cash inflows
• D)Both A and C are correct.

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Definitions:

ATC

Stands for "Average Total Cost," which is the total cost per unit of output in economics, calculated by dividing the total cost by the quantity produced.

Fixed Costs

Fixed expenses unaffected by variations in production volume or sales, like lease payments, employee salaries, and insurance fees.

Variable Costs

Expenses that vary directly with the volume of production or services a company offers, including labor and materials.

Total Revenue

A company's aggregate income from product sales and service charges within a set timeframe.