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Basic Question 7 of 16
It is important to identify and use only incremental cash flows in capital investment decisions ______
B. only when the stand-alone principle fails to hold.
C. because ultimately it is the change in a firm's overall future cash flows that matter.
D. in order to accommodate unforeseen changes.
E. whenever sunk costs are involved.
A. because they are the simplest to identify.
B. only when the stand-alone principle fails to hold.
C. because ultimately it is the change in a firm's overall future cash flows that matter.
D. in order to accommodate unforeseen changes.
E. whenever sunk costs are involved.
User Contributed Comments 4
| User | Comment |
|---|---|
| mattg | Only incremental CFs matter! |
| johntan1979 | Yup... cook the books all you like, cash is king! |
| ldfrench | Johntan1979, I don't think a book would taste very good? (But I could be wrong) My favorite snack is carrots. |
| Znanje35 | Baby carrots |
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Martin Rockenfeldt
Learning Outcome Statements
describe principles of capital allocation and common capital allocation pitfalls
CFA® 2024 Level I Curriculum, Volume 2, Module 5.