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7-1 Chapter Outline 1. remental Cash Flows 2. The Baldw ompany: An Example 3. The 777: A Real-World Example 4. Inflation and Capital Budgeting 5. Investments of Unequal Lives: The Equivalent Annual Cost Method 6. Sum nd Conclusions 7-2 7.1 remental Cash Flows Cash flows matter—not accounting earnings. Sunk costs don’tmatter. remental cash flows matter. Opportunity costs matter. Side effects like cannibalism and erosion m