On the net present value profile diagram showing two mutually exclusive projects with positive net present values, the mutually exclusive project with the curve that is _________ should be rejected.

Select one:

a.Positioned above the horizontal axis at the appropriate cost of capital rate

b.Positioned higher on the diagram than the other project, at the appropriate cost of capital rate

c.Positioned lower on the diagram than the other project, at the appropriate cost of capital rate

d.Positioned below the horizontal axis at the appropriate cost of capital rate

Consider the project described in the table below. What is the project's payback period?

cost of capital rate 5%

Time: 0, 1, 2, 3, 4

cash flow: -$5000 (0 time) , $500 (1 time), $1000(2 time) , $2000(3 time), $3000(4 time)

Select one:

a. 2.50

b. 2.75

c. 2.00

d. 2.25