Question
1) A financial manager is considering two projects, A and B. A is expected to add $2 million to profits next year, while B is
1) A financial manager is considering two projects, A and B. A is expected to add $2 million to profits next year, while B is expected to add $1.5 million to profits this year. Which of the following statements is MOST correct?
A) The manager should select project A because it maximizes profits.
B) The manager should select the project that maximizes long-term profits, not just one year of profits.
C) The manager should select project A or he is irrational.
D) The manager should select the project that causes the stock price to increase the most, which could be A or B.
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