Projects a and B Have Identical Expected Lives and Identical

question 1

Multiple Choice

Projects A and B have identical expected lives and identical initial cash outflows (costs) . However, most of one project's cash flows come in the early years, while most of the other project's cash flows occur in the later years. The two NPV profiles are given below: Which of the following statements is correct?

• A) More of Project A's cash flows occur in the later years.
• B) More of Project B's cash flows occur in the later years.
• C) We must have information on the cost of capital in order to determine which project has the larger early cash flows.
• D) The NPV profile graph is inconsistent with the statement made in the problem.

---

Definitions:

Breast Examinations

Clinical assessments performed to detect abnormalities or changes in the breast tissue, which can help in early detection of breast cancer or other breast-related conditions.

Fibroids

Noncancerous growths in the uterus that can lead to heavy menstrual bleeding, pain, and in some cases, fertility issues.

Smooth Tumors

Abnormal growths that originate in the body's smooth muscle tissues, often characterized by a rounded, soft appearance.

Uterus

A female reproductive organ in mammals where offspring are conceived and in which they gestate before birth; the womb.