If a Company Must Choose Between Two Mutually Exclusive Investment

question 88

Multiple Choice

If a company must choose between two mutually exclusive investment projects, the best general method to employ for decision-making purposes is:

• A) Cash-flow bailout.
• B) Cash-flow break-even.
• C) Net present value (NPV).
• D) Discounted payback.
• E) Accounting (book) rate of return (ARR), based on average investment over the life of each project.

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Definitions:

Positive Emotion

Feelings that are generally pleasant and uplifting, such as happiness, joy, or gratitude.

Self-satisfaction

refers to the feeling of pleasure and contentment with one's achievements, capabilities, or situation.

Actively Take Steps

The process of making conscious decisions to move forward with actions that contribute to achieving a particular goal or outcome.

Generating Ideas

The process of coming up with new, innovative concepts, solutions, or approaches, often as part of a creative or problem-solving exercise.