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Homework answers / question archive / Cash inflows that would have occurred if not for an investment decision being made are called ____
Cash inflows that would have occurred if not for an investment decision being made are called ____.
Group of answer choices
Opportunity costs
Incremental costs
Irrelevant costs
Sunk costs
Option a is correct option. Opportunity cost is the cash flow not obtained if investment is done in other projects. These cash flows are foregone and not achieved after choosing other project.
Incremental cash is not correct option. It is actually the increase in cash received in investing in a new project.
Irrelevant cost is not correct option. This cash outflow can be avoided.
Option d is incorrect option Sunk cost is cost invested in building or plant which cannot be recovered and is not used in capital budgeting decisions
