The Payback Period of Project a Is 2 Years While

question 59

Multiple Choice

The payback period of Project A is 2 years while that of Project B is 4 years. Which of the following statements is true?

• A)Project B must be riskier than Project A since it has a longer payback period.
• B)The IRR for Project A will be higher than that of Project B since Project A offers a quicker return on its investment.
• C)Project A should be chosen since it will increase value sooner than will Project B.
• D)None of the above is a true statement.

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Definitions:

Depression

An emotional disorder defined by an ongoing feeling of sadness or apathy towards activities, significantly impacting daily routines.

Metabolic Syndrome

A cluster of conditions including increased blood pressure, high blood sugar, excess body fat around the waist, and abnormal cholesterol levels, which together increase the risk of heart disease, stroke, and diabetes.