Coffer CoIs Analyzing Two Projects for the Future If the Company Is Using the Payback Period Method and One

question 83

Multiple Choice

Coffer Co.is analyzing two projects for the future.Assume that only one project can be selected. $\begin{array}{lrr}&\underline { \text {Project X } }&\underline { \text {Project Y } }\\ \text { Cost of } &\$ 68,000 & \$ 60,000\\ \text { machine } \\ \text { Net cash flow: } \\\text { Year 1 } & 24,000 & 4,000 \\\text { Year 2 } & 24,000 & 26,000 \\\text { Year 3 } & 24,000 & 26,000 \\\text { Year 4 } & 0 & 20,000\end{array}$ If the company is using the payback period method and it requires a payback of three years or less, which project should be selected?

• A)Project Y.
• B)Project X.
• C)Both X and Y are acceptable projects.
• D)Neither X nor Y is an acceptable project.
• E)Project Y because it has a lower initial investment.

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Definitions:

One-Sample Test

A statistical procedure used to determine whether a sample comes from a population with a specific characteristic.

Proportions

A statistical measure that represents the size of part of a whole, typically expressed as a fraction or percentage.

Proportion of Female Managers

The ratio or percentage of managerial positions held by women in a given organization or sector.

Conclusion

The end or finish of an event, process, or text, often summarizing findings or results.