A project has a $1,000 NPV, life of 10 years and 10% required rate of return. The Equivalent Annuity is:

A.

$162.74

B.

$385.50

C.

$6,144.60

D.

$62.75

X and L have unequal lives, can be replicated, and have unequal risk. They are mutually exclusive.

X has a $5,000 NPV, $1,500 Equivalent Annuity, and Fair Value of $14,000

L has a $7,000 NPV, $1,800 Equivalent Annuity, and Fair Value of $12,000

Choose:

	A.	X
	B.	L
	C.	Neither
	D.	Both