Which of the following statements is CORRECT?

a. An example of an externality is a situation where a bank opens a new office, and that new office causes deposits of the banks other offices to decline.

b. The cost of a marketing study completed last year related to the new product needs to be included as an initial cost.

c. Corporations must use the same depreciation method (e.g., straight line or MACRS) for stockholder reporting and tax purposes.

d. Since depreciation is not a cash expense, it has no effect on cash flows and thus no effect on capital budgeting decisions.