Yonan Inc Is Considering Projects S and L, Whose Cash Flows

question 59

Multiple Choice

Yonan Inc. is considering Projects S and L, whose cash flows are shown below. These projects are mutually exclusive, equally risky, and not repeatable. If the decision is made by choosing the project with the shorter payback, some value may be forgone. How much value will be lost in this instance? Note that under some conditions choosing projects on the basis of the shorter payback will not cause value to be lost.

• A) $24.14
• B) $26.82
• C) $29.80
• D) $33.11
• E) $36.42

---

Definitions:

Perforated Septum

A condition where the nasal septum, the bone and cartilage that separates the nasal cavity, has one or more holes.

Conidium

An asexual spore that is usually formed at the tip of a specialized hypha called a conidiophore.

Basidium

The clublike spore-producing organ of basidiomycetes that bears sexual spores called basidiospores.

Ascocarps

The fruiting bodies produced by ascomycete fungi, which contain the spore-producing structures.