Ontario Corp

Multiple Choice

Ontario Corp.'s management has determined that two independent projects have the following NPV:Project A NPV $5,000Project B NPV $10,000Which best describes the correct managerial decision given the information above (assume Ontario Corp can fund both projects if required) ?

A) Decline both projects since they are independent and have positive NPVs.
B) Accept both projects since they are independent and have positive NPVs.
C) Accept B, and decline A, since B has a higher positive NPV compared to A.
D) In order to decide between these independent projects, we need the IRR of each project.