2 Part Question

Samsung Electronics has a required payback period of three years for all of its projects. Currently, the firm is analyzing two independent projects. Project A has an expected payback period of 4 years and a net present value of $6,800. Project B has an expected payback period of 2 years with a net present value of $28,400. Which projects should be accepted based on the payback decision rule?

	Project A only
	Project B only
	Both A and B
	Neither A nor B

Samsung Electronics is now comparing two mutually exclusive projects A and B. The crossover point is 10% percent. Samsung has determined that they should accept project A if the required return is 8 percent. This implies you should:

	always accept project A
	always accept project A if the required return is smaller than the crossover rate
	be indifferent to the projects at any discount rate above 10 percent
	accept project B only when the required return is zero.
	always accept project A if the required return exceeds the crossover rate