Project Q Has an Initial Cost of $257,412 and Projected

question 25

Multiple Choice

Project Q has an initial cost of $257,412 and projected cash flows of $123,300 in Year 1 and $180,300 in Year 2.Project R has an initial cost of $345,000 and projected cash flows of $184,500 in Year 1 and $230,600 in Year 2.The discount rate is 12.2 percent and the projects are independent.Which project(s) ,if either,should be accepted based on its profitability index value?

• A)Accept both Project Q and R
• B)Reject both Project Q and R
• C)Accept Project Q and reject Project R
• D)Accept Project R and reject Project Q
• E)Accept either Project R or Project Q,but not both

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Definitions:

Extension

An increase in the angle between bones at a joint or the straightening of a limb.

Straightening Movement

refers to the motion aimed at making something linear or rectifying its alignment.

Adduction

To draw together toward the midline.

Midline

A term often used in anatomy to refer to the central line of the body or an organ, dividing it into right and left halves.