Virus Stopper Inc

question 12

Multiple Choice

Virus Stopper Inc. ,a supplier of computer safeguard systems,uses a required rate of return of 12 percent to evaluate average risk projects,and it adds or subtracts 2 percentage points to evaluate projects of more or less risk.Currently,two mutually exclusive projects are under consideration.Both have a cost of $200,000 and will last 4 years.Project A,a riskier-than-average project,will produce annual end of year cash flows of $71,104.Project B,of less than average risk,will produce cash flows of $146,411 at the end of Years 3 and 4 only.Virus Stopper should accept

• A) B with a NPV of $10,001.
• B) Both A and B because both have NPVs greater than zero.
• C) B with a NPV of $8,042.
• D) A with a NPV of $7,177.
• E) A with a NPV of $15,968.

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Definitions:

Completed Suicide Rate

A statistical measure reflecting the number of deaths due to suicide per unit of population over a specific time period.

Males

Refers to the biological sex that produces spermatozoa for reproduction, typically characterized by XY chromosomes in humans.

Females

Typically refers to individuals of the human species who are biologically characterized by two X chromosomes, but the term is also relevant in understanding gender as a social construct.

Law-breaking Behaviors

Actions that violate the law, ranging from minor violations to significant offenses, often subject to legal punishment.