Wilson CoIs Considering Two Mutually Exclusive Projects

question 68

Multiple Choice

Wilson Co.is considering two mutually exclusive projects.Both require an initial investment of $9,100 at t = 0.Project X has an expected life of 2 years with after-tax cash inflows of $5,500 and $8,200 at the end of Years 1 and 2,respectively.In addition,Project X can be repeated at the end of Year 2 with no changes in its cash flows.Project Y has an expected life of 4 years with after-tax cash inflows of $4,800 at the end of each of the next 4 years.Each project has a WACC of 11%.What is the equivalent annual annuity of the most profitable project? Do not round intermediate calculations.

• A) $2,502
• B) $1,885.50
• C) $1,553.77
• D) $1,680.15
• E) $1,465.82

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Definitions:

Academic Self-concept

An individual's perception of their own academic abilities or skills.

Academic Self-efficacy

An individual's belief in their own ability to succeed in academic tasks.

Academic Disidentification

A psychological process where students detach their sense of self-worth from their academic performance.

Theory of Planned Behavior

A psychological theory that links beliefs and behavior, suggesting that an individual’s intention to engage in a behavior is influenced by attitudes, subjective norms, and perceived control over the behavior.