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.
Correct Answer:
Verified
Correct Answer:
Verified
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