A potential disadvantage of groups in organizations is that they

A) often breed conformity in thinking and behavior.
B) encourage a spirit of teamwork.
C) encourage individuality in thinking and behavior.
D) discourage consensus thinking.

Answer: A

Business

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The main attraction of outside training specialists is their complete familiarity with a company's selling situation.

a. true b. false

Business

AFB Corp needs to replace an old lathe with a new, more efficient model. The old lathe was

purchased for $50,000 nine years ago and has a current book value of $5,000. (The old machine is being depreciated on a straight-line basis over a ten-year useful life.) The new lathe costs $100,000. It will cost the company $10,000 to get the new lathe to the factory and get it installed. The old machine will be sold as scrap metal for $2,000. The new machine is also being depreciated on a straight-line basis over ten years. Sales are expected to increase by $8,000 per year while operating expenses are expected to decrease by $12,000 per year. AFB's marginal tax rate is 40%. Additional working capital of $3,000 is required to maintain the new machine and higher sales level. The new lathe is expected to be sold for $5,000 at the end of the project's ten-year life. What is the incremental free cash flow during years 2 through 10 of the project? A) $15,800 B) $14,400 C) $16,400 D) $13,600

Business