Table 10.4 A Firm Is Evaluating Two Projects That Are Mutually Exclusive

question 166

Multiple Choice

Table 10.4
A firm is evaluating two projects that are mutually exclusive with initial investments and cash flows as follows:
-The new financial analyst does not like the payback approach (Table 10.4) and determines that the firm's required rate of return is 15 percent. His recommendation would be to

• A) accept projects A and B.
• B) accept project A and reject B.
• C) reject project A and accept B.
• D) reject both.

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