Question: 2. It is important to identify and use only incremental cash flows in capital investment decisions: A. Whenever sunk costs are involved. B. Only when

2. It is important to identify and use only incremental cash flows in capital investment decisions:

A. Whenever sunk costs are involved. 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. To accommodate unforeseen changes that might occur.

Answer : C

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