If the cost of capital (discount rate) is 10%, which project(s) do you invest in and why? OA. Project B- it will pay back the quickest B. Project C- it generates the greatest cash flow C. Project A- it has the highest accounting rate of return D.Project B-it has the highest net present value E. Project A- it has the highest net present value F. Project C-it has the highest profitability index
If the cost of capital (discount rate) is 10%, which project(s) do you invest in and why? OA. Project B- it will pay back the quickest B. Project C- it generates the greatest cash flow C. Project A- it has the highest accounting rate of return D.Project B-it has the highest net present value E. Project A- it has the highest net present value F. Project C-it has the highest profitability index
Chapter11: The Cost Of Capital
Section: Chapter Questions
Problem 19PROB
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![QUESTION 14
You have a total of $30,000 to invest in a project and are considering the following three projects:
Cash Flows
Project A
($30,000)
$8,500
Year
Project B
($30,000)
$19,600
Project C
($30,000)
$10,400
1
$9,300
$17,300
$4,500
$10,400
$10,400
3.
$10,400
4.
$11,200
$4,200
$10,400
$12,300
$2,300
$10,400
If the cost of capital (discount rate) is 10%, which project(s) do you invest in and why?
A. Project B- it will pay back the quickest
OB. Project C- it generates the greatest cash flow
C. Project A-it has the highest accounting rate of return
D.Project B-it has the highest net present value
E. Project A- it has the highest net present value
OF. Project C- it has the highest profitability index](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F88af8fce-c435-443b-b71c-a96145ca39af%2Fb8245c8c-855f-4b46-bdb1-d350164b2ac2%2F2kev608_processed.jpeg&w=3840&q=75)
Transcribed Image Text:QUESTION 14
You have a total of $30,000 to invest in a project and are considering the following three projects:
Cash Flows
Project A
($30,000)
$8,500
Year
Project B
($30,000)
$19,600
Project C
($30,000)
$10,400
1
$9,300
$17,300
$4,500
$10,400
$10,400
3.
$10,400
4.
$11,200
$4,200
$10,400
$12,300
$2,300
$10,400
If the cost of capital (discount rate) is 10%, which project(s) do you invest in and why?
A. Project B- it will pay back the quickest
OB. Project C- it generates the greatest cash flow
C. Project A-it has the highest accounting rate of return
D.Project B-it has the highest net present value
E. Project A- it has the highest net present value
OF. Project C- it has the highest profitability index
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