You Are Considering the Following Two Mutually Exclusive Projects Based Upon the Internal Rate of Return (IRR) and the Projects

question 29

Multiple Choice

You are considering the following two mutually exclusive projects. Both projects will be depreciated using straight-line depreciation to a zero book value over the life of the project. Neither proiect has any salvaqe value.
$\begin{array}{l}\begin{array} { | l | l | l | } \hline \text { Year } & \text { Project A } & \text { Project B } \\\hline 0 & - £ 75,000 & - £ 70,000 \\\hline 1 & £ 19,000 & £ 10,000 \\\hline 2 & £ 48,000 & £ 16,000 \\\hline 3 & £ 12,000 & £ 72,000 \\\hline\end{array}\\\begin{array} { | l | l | l | } \hline & \text { Project A } & \text { Project B } \\\hline \text { Required rate of return } & 10 \% & 13 \% \\\hline \text { Required payback period } & 2.0 \text { years } & 2.0 \text { years } \\\hline \text { Required accounting return } & 8 \% & 11 \% \\\hline\end{array}\end{array}$
Based upon the internal rate of return (IRR) and the information provided in the problem, you should:

• A)accept both project A and project B.
• B)reject both project A and project B.
• C)accept project A and reject project B.
• D)accept project B and reject project A.
• E)ignore the IRR rule and use another method of analysis.

Examine exceptions to the rule requiring consideration in contract formation and enforceability.

Analyze the role of past consideration in contract law and its typical exclusion from forming valid consideration.

Acquire knowledge of special circumstances where courts might intervene in contract agreements, focusing on fairness and legalities involved.

Understand the implications of different organizational structures and departmentations on quality, coordination, and adaptability.

---

Definitions:

Deindividuated

A psychological state characterized by reduced self-awareness and diminished social identity, often leading to disinhibited behavior.

Combative

Characterized by an eagerness to fight or be aggressive.

Mindless

Acting or doing something without conscious thought or attention, often resulting in automatic or habitual behavior.

Altruistically

Acting with selfless concern for the well-being of others, without expectation of reward or recognition.