The Square Box Is Considering Two Projects,both of Which Have

question 71

Multiple Choice

The Square Box is considering two projects,both of which have an initial cost of $35,000 and total cash inflows of $50,000.The cash inflows of project A are $5,000,$10,000,$15,000,and $20,000 over the next four years,respectively.The cash inflows for project B are $20,000,$15,000,$10,000,and $5,000 over the next four years,respectively.Which one of the following statements is correct if The Square Box requires a 13 percent rate of return and has a required discounted payback period of 3.5 years?

• A)Both projects should be accepted.
• B)Both projects should be rejected.
• C)Project A should be accepted and project B should be rejected.
• D)Project A should be rejected and project B should be accepted.
• E)You should be indifferent to accepting either or both projects.

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Definitions:

High-Performing Executives

Senior managers or directors in an organization known for exceptional achievement and productivity.

Self-Censor

The act of restricting what one says or reveals about oneself to avoid offending others or crossing social or cultural boundaries.

Foolish Decisions

Choices made without proper judgment or consideration of the consequences, often leading to unfavorable outcomes.

Task-oriented

Describes an approach or a person focused primarily on completing tasks and achieving objectives efficiently.