The Weston Corporation Is Analyzing Projects A, B, and C

question 12

Multiple Choice

The Weston Corporation is analyzing projects A, B, and C as possible investment opportunities. Each of these projects has a useful life of five years. The following information has been obtained:



-Which of the following statements is correct?

• A)Project B is preferred over Project C according to the project profitability index.
• B)Project B is preferred over Project A according to the internal rate of return.
• C)Project C is preferred over Project A according to the project profitability index.
• D)Project A is preferred over Project C according to a net present value ranking.

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Definitions:

Bystander Effect

A social psychological theory that individuals are less likely to offer help to a victim when other people are present.

Diffusion of Responsibility

Refers to a sociopsychological phenomenon where individuals are less likely to take action or feel a sense of responsibility in the presence of a large group of people.

Pluralistic Ignorance

A psychological phenomenon where individuals wrongly believe their feelings and beliefs are different from those of the group, often leading to conformity despite personal objections.

Good Samaritan Effect

A phenomenon where individuals are more likely to help others in need without expecting anything in return, inspired by the biblical parable of the Good Samaritan.