Lakeland Ramblers Is Considering Two Mutually Exclusive Projects to Boost

question 6

Multiple Choice

Lakeland Ramblers is considering two mutually exclusive projects to boost their tourist revenue.Project A costs $60,000 and would produce net cash flows of $25,000 for 5 years.Project B cost $100,000 and will produce annual net cash flows of $25,000 for 10 years.If Lakeland's cost of capital is 12%, which project should be chosen using the equivalent annual annuity method?

• A)Project A, NPV is $17,941 higher
• B)Project B, NPV is $11,125 higher
• C)Project A, NPV is $28,383 higher
• D)Project B, NPV is $21,567 higher

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Definitions:

Mental Modules

are hypothesized innate structures in the brain that allow individuals to perform complex cognitive tasks and process specific types of information.

Biological Understandings

Knowledge pertaining to the biological sciences, encompassing areas like genetics, physiology, evolution, and the functioning of living organisms.

Living and Non-Living Kinds

Concerns the categorization of objects or entities into those that possess life and those that do not.

False Belief Task

A psychological test used to assess a child's understanding that other people can hold beliefs different from their own and that those beliefs can be wrong.