What is the best reason for that decision

Assignment Help Finance Basics
Reference no: EM13267030

You are considering the following two mutually exclusive projects. The required return on each project is 14 percent. Which project should you accept and what is the best reason for that decision?

Year Project A Project B

0 --$24,000 --$24,000

1 9,000 7,000

2 12,000 9,000

3 10,000 18,000

A.

Project A, because it pays back faster

B.

Project A, because it has the higher profitability index

C.

Project B, because it has the higher profitability index

D.

Project A, because it has the higher net present value

E.

Project B, because it has the higher net present value

Reference no: EM13267030

What is profitability index if discount rate is 11 percent

A firm is reviewing a project that has an initial cost of $71,000. The project will produce annual cash inflows, starting with year 1, of $8,000, $13,400, $18,600, $33,100,

What are the gifting tools used to gift to minors

Plese explain the process of gifting in estate planning. More specifically, what are the gifting tools used to gift to minors and what are the advantages/disadvantages of ea

What is the net present value of a project

What is the net present value of a project that has an initial cost of $40,000 and produces cash inflows of $8,000 a year for 11 years if the discount rate is 15 percent?

Find the value of a two period abc american call

The price of ABC stock is binomially distributed, either moving up 30%, or down 20%, each period. Assume there are no dividends. The current stock price is $100/shr, and the

Determine efficience and praice variances

quantity variable, quanitity fixes, unit cost, variable cost, averge fixed cost, average total cost in addition to patient days and expected days. I have another table with

Use the capm to determine the appropriate discount rate

Allied products uses the MACRS depreciation schedule (seven-year property class). The immediate initial working capital requirement is $2 million thereafter the net working

What will be the effect on profit of accepting the order

On the one hand they welcome the order because they currently have excess capacity. Also, this is the company's first international order. On the other hand, the company in

What is the full cost of a globe with a 0.30 markup

The Falling Snow Company is considering production of a lighted world globe that the company would price at a markup of 0.30 percent above full cost. Management estimates th

Reviews

Write a Review

 
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd