Question: A hospital CEO is evaluating three projects and has asked one of his analysts to compute the Net Present Value NPV for each of them

A hospital CEO is evaluating three projects and has asked one of his analysts to compute the Net Present Value NPV for each of them to help him make his decision. The projects include: A new MRI center NPV $4,223,000 A same-day surgery center NPV 3,934,000 A new hospice center NPV - 1,300,000 While the new hospice has a negative Net Present Value, the local community is badly in need of an additional hospice facility and community leaders are pressuring the CEO to fund the project. Given this, what is the CEO likely to do? a. Tell the community leaders to take a hike as he's not going to fund a project with a negative NPV. b. Meet with the community leaders to discuss the finances along with potential options for building the hospice with additional community funding support. c. Work with his analyst to re-asses the hospice along with current hospital finances to see if the hospice project is viable. d. Cancel all the projects as he's very busy and doesn't need this. e. Both b. and c. are correct

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