The Following Data Was Given for Three Projects Being Considered

question 43

Multiple Choice

The following data was given for three projects being considered by Manosteel Ltd. Only one project can be accepted due to funding limitations. $\begin{array}{llcc}\text { Project } & \text { IRR } & \text { NPV } & \text { Payback } \\\text { A } & 16 \% & \$ 18,000 & 7 \mathrm{yrs} \\\mathrm{B} & 18 \% & \$ 100,000 & 5 \mathrm{yrs} \\\mathrm{C} & 15 \% & \$ 95,000 & 10 \mathrm{yrs}\end{array}$ Which project is the best given that Manosteel's required rate of return is 14%?

• A)Project A.
• B)Project B.
• C)Project C.
• D)All projects should be accepted, as all have a positive Net Present Value and an Internal Rate of Return greater than the required rate of return.

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Definitions:

Gilded Age

A period in the late 19th century in the United States characterized by rapid industrialization, economic growth, and the ostentatious wealth of a burgeoning class of industrialists and financiers.

Gini Coefficient

A measure ranging from 0 to 1 that indicates the degree of income inequality in a given population, with 0 expressing perfect equality and 1 indicating maximum inequality.

Income Equality

A situation in which earnings are distributed evenly across a population, minimizing the gap between the highest and lowest incomes.

European Countries

Nations located within the continent of Europe, each characterized by its own government, culture, and economic system.