Two Projects Being Considered Are Mutually Exclusive and Have the Following

question 27

Multiple Choice

Two projects being considered are mutually exclusive and have the following projected cash flows: $\begin{array}{lll}\underline{\text { Year} } & \underline{\text { Project A}}& \underline{\text { Project B }}\\0 & -\$ 50,000 & -\$ 50,000 \\1 & 15,990 & 0 \\2 & 15,990 & 0 \\3 & 15,990 & 0 \\4 & 15,990 & 0 \\5 & 15,990 & 100.560\end{array}$
At what rate (approximately) do the NPV profiles of Projects A and B cross?

• A)6.5%
• B)11.5%
• C)16.5%
• D)20.0%
• E)The NPV profiles of these two projects do not cross.

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Definitions:

Variable Force

A force that changes in magnitude and/or direction over time.

Adaptation

A process by which organisms become better suited to their environment to survive and reproduce.

Genetic Cloning

The process of creating genetically identical copies of an organism, cell, or DNA sequence using biotechnological methods.

Evolutionary Forces

Elements such as natural selection, mutation, gene flow, and genetic drift that cause changes in the genetic composition of a population over time.