A Firm Has to Choose Between Projects X and Y

question 53

Multiple Choice

A firm has to choose between projects X and Y.Project X's internal rate of return is positive.If the cash flow of project Y is discounted at project X's internal rate of return,this firm will

• A) choose project X if the net present value of project Y is positive.
• B) choose project X if the net present value of project Y is negative.
• C) choose project Y if the net present value of project Y is positive.
• D) choose project X regardless of the net present value of project Y.

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Definitions:

Clean Air Act

A comprehensive federal law in the United States that regulates air emissions from stationary and mobile sources in order to protect public health and the environment.

National Ambient Air Quality Standards

Regulations established by the U.S. Environmental Protection Agency to protect public health and the environment from air pollution.

Restricted-Use Registration

A regulatory status limiting the use of certain products, such as chemicals or pesticides, to certified professionals to mitigate risks.

Certified Applicator

An individual or entity recognized and authorized to apply certain products, often chemicals, according to regulatory standards.