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You have a choice between these 2 mutually exclusive investments, Projects A and B. If you require a 15% return, which investment should you choose?
You have a choice between these 2 mutually exclusive investments, Projects A and B. If you require a 15% return, which investment should you choose? Project A Project B Year Cash Flow Cash Flow O -100,000 -125,000 20,000 74,000 40,000 46,000 N W 81,000 40,000 O Project A, because it has a smaller initial investment. O Project B, because it has a higher NPV. 0 Either one, because they have the same profitability indexes. O Project A, because it has the higher NPV. O Project B, because it pays back faster
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