Teck Engineering normally expects a rate of return of 12% on investments. Two projects are available but

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Teck Engineering normally expects a rate of return of 12% on investments. Two projects are available but only one can be chosen. Project A requires an immediate investment of $4000. In return, a revenue payment of $4000 will be received in four years and a payment of $9000 in nine years. Project B requires an investment of $4000 now and another $2000 in three years. In return, revenue payments will be received in the amount of $1500 per year for nine years. Which project is preferable?
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Contemporary Business Mathematics with Canadian Applications

ISBN: 978-0133052312

10th edition

Authors: S. A. Hummelbrunner, Kelly Halliday, K. Suzanne Coombs

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