Consider Two Mutually Exclusive Projects a & B

question 9

Multiple Choice

Consider two mutually exclusive projects A & B.If you subtract the cash flows of opportunity B from the cash flows of opportunity A,then you should:

• A)take opportunity A if the regular IRR exceeds the cost of capital.
• B)take opportunity A if the incremental IRR exceeds the cost of capital.
• C)take opportunity B if the regular IRR exceeds the cost of capital.
• D)take opportunity B if the incremental IRR exceeds the cost of capital.

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Definitions:

X-Linked Recessive Trait

A genetic condition that is passed down through the X chromosome, where males are more frequently affected because they only have one X chromosome.

Blood Clotting

A physiological process where blood changes from a liquid to a gel, forming a clot to prevent bleeding.

Hemophilia A

A genetic disorder causing a deficiency in clotting factor VIII, leading to excessive bleeding.

Amniocentesis

A medical procedure used in prenatal diagnosis to sample amniotic fluid using a needle inserted into the uterus, to screen for genetic disorders and fetal infections.