Projects X and Y are mutually exclusive. Project X: Invest $1000, PV return in 3 years is
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Question:
- Projects X and Y are mutually exclusive.
Project X: Invest $1000, PV return in 3 years is $2000.
Project Y: Invest $2000, the PV return in 1 year is $3500.
Which one should you invest in?
A. | Invest in Y because it has the largest NPV. | |
B. | Invest in Y as it has a higher return per dollar invested. | |
C. | Invest in X as it requires less investment. | |
D. | Invest in both as they both have positive NPVs. | |
MI. | Invest in Y because it pays for itself sooner. |
Related Book For
Intermediate Financial Management
ISBN: 978-1111530266
11th edition
Authors: Eugene F. Brigham, Phillip R. Daves
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