A Company Looking for a Return of 12% Has Capital

question 8

Multiple Choice

A company looking for a return of 12% has capital available for projects equalling $100,000 and three projects under consideration. Each of the projects will last five years. While all the projects are divisible, if the company selects project B, it cannot do project C. Project A costs $54,000 and provides and income before amortization of $25,000, $25,000, $28,000, $26,000, and $22,000, respectively. Project B costs $63,000 and provides $12,000, $16,000, $20,000, $30,000 and $45,000 respectively. Project C costs $70,000 and provides $35,000 $24,000 $18,000 $19,000 and $10,000 respectively. The company should do

• A) Project A and part of Project B as the NPV is highest for Project A and NPV is higher for Project B than Project C
• B) Project A and part of Project C as profitability index is highest for Project A and is higher for Project C than for Project B
• C) Project B and part of Project A as NPV is highest for Project B and higher for Project A than Project C
• D) All of Project C and part of Project A as this maximizes cash flow according to the profitability index
• E) All of Project B and part of Project A as this maximizes cash flow according to the profitability index

Recognize the implications of social exchange theory on marital decisions and family dynamics.

Evaluate various research methodologies and their applications in family studies, including their advantages and disadvantages.

Acknowledge the ethical considerations and generalizability of family research findings.

Understand the benefits and advantages of online surveys in research.

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Definitions:

Profit-Maximizing Price

The price at which a company can sell its product or service to achieve the highest possible profit, considering demand and marginal costs.

High Speed Internet

A type of internet service that offers significantly faster data transmission speeds compared to traditional dial-up connections.

Cable Television

A system of delivering television programming to paying customers via radio frequency signals transmitted through coaxial cables.

Tying Strategy

A sales strategy where one product or service is sold conditional on the purchase of another product or service.