Projects a and B Both Have an Initial Outflow of $100,000.Project

question 52

Multiple Choice

Projects A and B both have an initial outflow of $100,000.Project A will return a cash flow of $30,000 each year for the next 5 years.Project B will return $40,000 in year 1, $30,000 in year 2, $30,000 in year 3, $30,000 in year 4, and $20,000 in year 5.Which project will have the higher net present value?

• A)Project A
• B)Project B
• C)The answer cannot be determined without knowing the required rate of return.
• D)The answer cannot be determined without knowing the initial investment.

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Definitions:

General Acceptance

General acceptance pertains to the widespread approval or agreement by a majority within a particular group or society.

Organizational Change

Change that a group of people must learn to accept and implement.

Technology Barrier

Obstacles that hinder the adoption, implementation, or effective use of technologies, possibly due to economic, social, or practical reasons.

OD Intervention

Training tools that teach members of the organization how to solve problems they face or make needed changes to organizational development (OD).