Question
Two projects are being considered. An office building has an IRR of 20%; NPV of $100,000 and a payback of 3 years. Alternatively a small
Two projects are being considered. An office building has an IRR of 20%; NPV of $100,000 and a payback of 3 years. Alternatively a small sandwich shop has an IRR of 40%; NPV of $25,000 and a payback of 1 year. Which of the two projects should be chosen?
| If projects are mutually exclusive, choose both; if projects are independent, choose Sandwich shop.
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| If projects are mutually exclusive, choose Office building; if projects are independent, choose both.
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| If projects are mutually exclusive, choose Sandwich Shop; if projects are independent, choose both.
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| Do not choose any of the projects under any circumstances.
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| If projects are mutually exclusive, choose both; if projects are independent, choose Office Building.
|
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The New Finance Overreaction Complexity And Their Consequences
Authors: Robert A. Haugen
4th International Edition
0132775875, 9780132775878
