Project a Has a $5,000 Net Present Value at a Zero

question 77

Multiple Choice

Project A has a $5,000 net present value at a zero discount rate and an internal rate of return of 12%.Project B has an $8,000 net present value at a 0% discount rate and an IRR of return of 10%.If the projects are mutually exclusive,which one should be chosen?

• A) Project A because it has a higher internal rate of return.
• B) Project B if the cost of capital is less than the crossover point.
• C) Both projects if the net present value is positive.
• D) Neither project meets the investment criteria.

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Definitions:

Authority

The ability to dictate actions, decide on matters, and compel adherence.

Information Flow

The transfer of information from a source to a recipient through various means of communication or channels.

Organizational Culture

The set of shared values, beliefs, and norms that influences the way employees think, feel, and behave within an organization.

Ergonomics

The study of people's efficiency in their working environment, aiming to improve working conditions and increase productivity by adapting the job, equipment, and workspace to fit the worker.