A Company Is Considering Purchasing a New Machine, at a Cost

question 36

Multiple Choice

A company is considering purchasing a new machine, at a cost of $50,000.This amount will be written off over 5 years at $10,000 per year.In the first year the company will have to increase its accounts receivable by $4,000, and inventory by $8,000.The disposal value of the machine being replaced is $1,500 and will be used to offset the amount borrowed for the new machine.What is the initial working capital investment required for the purpose of capital budgeting?

• A)$8,000
• B)$60,500
• C)$10,500
• D)$12,000
• E)$4,000

Understand the calculation of conditional probabilities and their relevance in sequences of events.

Recognize the application of probability in games of chance, assessing risks, and making predictions.

Learn to calculate probabilities involving combinations and permutations in specific scenarios.

Identify the impact of prior outcomes on the probability of future events in independent events.

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Definitions:

Punishment

A negative consequence applied following an undesired behavior to decrease the likelihood of that behavior occurring again.

Extinction

The process by which a previously learned behavior diminishes in frequency or disappears as a result of the absence of reinforcement.

Spontaneous Recovery

A phenomenon in classical conditioning where a previously extinguished response re-emerges after a period of non-exposure to the conditioned stimulus.

Psychodynamic

A psychological perspective that emphasizes the influence of the unconscious mind on behavior.