The Following Table Gives the Estimated Costs and Benefits of a Proposed

Multiple Choice

The following table gives the estimated costs and benefits of a proposed public convention center.
Table 11-1

-Two mutually exclusive projects,expected to last indefinitely,are being compared.Program A has annual profits and consumer surplus of $10 million and a one-time capital expenditure of $50 million.Program B has consumer surplus of $15 million and a one-time capital expenditure of $100 million.Using net present value as a criterion,which alternative should be selected?

A) If the discount rate is 12%,Program B should be selected.
B) If the discount rate is less than 10%,Program B should be selected.
C) If the discount rate is 22%,neither program should be selected.
D) The programs have the same net present value regardless of the discount rate used.
E) Answers b and c are both correct.