Matt Is Analyzing Two Mutually Exclusive Projects of Similar Size

question 51

Multiple Choice

Matt is analyzing two mutually exclusive projects of similar size and has prepared the following data.Both projects have 5 year lives.
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.

---

Definitions:

Mode of Transportation Pricing

The cost structure associated with different modes of transport, factoring in distance, speed, volume, and type of goods.

Vehicle

In marketing, a vehicle refers to the medium or channel used to transmit an advertising message to its intended audience, such as television, radio, or online platforms.

Single-Zone Pricing

A pricing strategy where a seller charges the same price for a product or service, regardless of where the buyer is located.

FOB Origin Pricing

A term used in shipping indicating that the buyer takes responsibility for shipping costs and risk of loss from the seller’s location.