Matt Is Analyzing Two Mutually Exclusive Projects of Similar Size

question 87

Multiple Choice

Matt is analyzing two mutually exclusive projects of similar size and has prepared the following data.Both projects have 5 year lives. $$\begin{array} { l l l } & \frac { \text { Project } \mathrm { A } } { } & \frac { \text { Project B } } { } \\\text { Net present value } & \$ 15,090 & \$ 14,693 \\\text { Payback period } & 2.76 \text { years } & 2.51 \text { years } \\\text { Required return } & 8.3 \% & 8.0 \%\end{array}$$ Matt has been asked for his best recommendation given this information.His recommendation should be to accept:

• A)project B because it has the shortest payback period.
• B)both projects as they both have positive net present values.
• C)project A and reject project B based on their net present values.
• D)project B and reject project A based on other criteria not mentioned in the problem.
• E)project B and reject project A based on both the payback period and the average accounting return.

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Definitions:

Motor Proteins

Proteins that convert chemical energy into mechanical work, moving along cytoskeletal filaments to transport cargo, contract muscles, or enable cell motility.

Microtubules

Cylindrical structures found in cells, crucial for maintaining cell shape, cell division, and intracellular transport.

Cancer

A disease characterized by the uncontrolled growth and spread of abnormal cells, which can form tumors and potentially lead to death if untreated.

Malignant Neoplasm

A cancerous tumor that invades surrounding tissues and has the potential to spread to distant body parts.