A Financial Manager Is Considering Two Projects,A and B

question 88

Multiple Choice

A financial manager is considering two projects,A and B.A is expected to add $2 million to profits this year while B is expected to add $2 million to profits this year while B is expected to add $1 million to profits this year.Which of the following statements is most correct?

• A) The manager should select project A because it maximizes profits.
• B) The manager should select the project that maximizes long-term profits, not just one year of profits.
• C) The manager should select project A or he is irrational.
• D) The manager should select the project that causes the stock price to increase the most, which could be A or B.

---

Definitions:

Neuroticism

A personality trait characterized by emotional instability, anxiety, moodiness, worry, and sadness.

Unique Traits

are attributes or characteristics that distinguish an individual from others, making them unique.

Innate Temperament

Refers to the inherent aspects of an individual's personality, including mood, behavior, and emotional responses, that are believed to be present from birth.

Intelligence

Intelligence is the ability to learn from experience, adapt to new situations, understand complex ideas, and use various forms of reasoning to overcome obstacles.