Business, 16.03.2020 19:33 genyjoannerubiera

How can an expansion decision such as project A be viewed as a special form of a replacement decision? Explain. a. Calculate the relevant cash flows for this replacement decision: (Round to the nearest dollar.) Relevant Year Cash Flows 0 $ (3,112,000) 1 $ 187,000 2 $ 557,000 3 $ 983,000 4 $ 1,848,000 5 $ 3,026,000 b. How can an expansion decision such as project A be viewed as a special form of a replacement decision? Explain. (Select the best choice below.) A. An expansion project is simply a replacement decision in which all relevant cash flows are the incremental cash flows. B. A replacement project is simply an expansion decision in which all cash flows are the incremental cash flows. C. An expansion project is simply a replacement decision in which all cash flows from the old asset are zero. D. A replacement project is simply an expansion decision in which all cash flows from the old asset are zero.

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