Q: A Good CFO will tell you that it is important to look at your bottom line and determine how to increase profits for the organization. Veronica, the new CFO at a local university, is taking that approach and applying it to new projects. Therefore,she wants to include costs from each phase of the project on a total expenditure is known as
- 1An opportunity costfalse
- 2A sunk costfalse
- 3NPVfalse
- 4A life cycletrue
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Answer : 4. "A life cycle"
Explanation :
Answer: D) A life cycle Explanation: Life Cycle costing includes the costs from each phase of the project life cycle when the total investment costs are calculated. Answer A is incorrect because an opportunity cost is the difference between a chosen investment and the one that is passed up. Answer B is incorrect because sunk costs are costs that have been incurred and cannot be reversed. Answer C is incorrect because net present value (NPV) is the present value of cash inflows(benifits) minus the present value of cash outflows (costs).
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