You Are Considering Two Independent Projects That Have Differing Requirements

question 54

Multiple Choice

You are considering two independent projects that have differing requirements.Project A has a required return of 12 percent compared to Project B's required return of 13.5 percent.Project A costs $75,000 and has cash flows of $21,000,$49,000,and $12,000 for Years 1 to 3,respectively.Project B has an initial cost of $70,000 and cash flows of $15,000,$18,000,and $41,000 for Years 1 to 3,respectively.Based on the NPV,you should:

• A)accept both Project A and Project B.
• B)accept Project A and reject Project B.
• C)accept Project B and reject Project A.
• D)reject both Project A and Project B.
• E)accept whichever one you want but not both.

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Definitions:

Medulla

An inner region or core in various organs or cells, often referring specifically to the innermost part of the kidney or the lower part of the brain stem.

Respiratory Centers

Centers in the medulla and pons that regulate breathing.

Chemoreceptors

Sensory receptors that respond to chemical stimuli, such as those found in the nose and taste buds.

Ventral Medulla

A key section of the brainstem involved in regulating autonomic functions, such as heart rate and breathing.