To help distinguish opportunity costs and incremental cash flows, consider these four examples:

1) A firm spends $100,000 on a project, when it could invest the money and earn a 10% return.

2) A firm is renting out office space for $5,000/month, but will use the office space for a new project.

3) A firm will hire a new employee for $100,000/year to head up a new project.

4) A firm paid $100,000 five years ago, but the land is unusable for the current project.

Which of these are opportunity costs? Which are incremental cash flows?