The incremental cash flows of a project are best defined as:.a. the increase or decrease in a firm's cash flows resulting from adding the project, excluding all sunk and opportunity costs. b. any change in a firm's cash flows resulting from the addition of the project including opportunity costs. c. the total cash flows of a firm once the new project is completely integrated into the firm's operations. d. the cash received from the additional sales generated by the project.

The correct answer is option (B) any change in a firm's cash flows resulting from the addition of the project including opportunity costs

Explanation:

Solution

The amount of additional cash flow operating to the firm by taken anew project is referred to as incremental cash flow, just as it is incremental, the flow would be a positive increment.

A firm or organization always look towards having an incremental that is positive for cash flow to in maximizing share holder's profit or wealth.

Hence, in order to find the incremental cash flow the firm should examine the opportunity cost that could have been used in other places to generate revenue.

a recipe serves 8 people, and calls for 5 lbs of apples and 2 cups of flour. you want to prepare it for 24 people. divide 24 by 8 to get 3, and then multiply your ingredients by 3.

so for 24 people, you'll need 15 lbs of apples, and 6 cups of flour.