Which One of the Following Is Not a Basic Principle

question 21

Multiple Choice

Which one of the following is not a basic principle for estimating a project's net cash flows?

• A)Sunk costs are relevant.
• B)Cash flows should be estimated on an incremental basis.
• C)Cash flows should be estimated on an after-tax basis.
• D)Opportunity costs are relevant.

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Definitions:

Government Regulation

The act of controlling business behavior through rules or laws, enacted to protect public interest.

Cooperative Factories

Manufacturing establishments run by a collective group of workers who share the profits and management responsibilities.

Seventeenth Amendment

An amendment to the U.S. Constitution, ratified in 1913, that established the direct election of U.S. senators by popular vote, replacing their previous selection by state legislatures.

Direct Election

A system of choosing political officials where voters directly cast ballots for the persons or party candidates they desire to see in office, without the intervention of electors or intermediaries.