Two investments have the same initial cost and total revenue stream over a 5 year period. Investment A has an equal revenue stream and investment B generates significantly higher revenues the first three years. Based on this information investment B will likely generate: A. A higher net present value the investment A B. A higher internal rate of return than investment A C. A higher net present value and higher internal rate of return than investment A D. A lower net present value and lower internal rate of return than investment A
Two investments have the same initial cost and total revenue stream over a 5 year period. Investment A has an equal revenue stream and investment B generates significantly higher revenues the first three years. Based on this information investment B will likely generate: A. A higher net present value the investment A B. A higher internal rate of return than investment A C. A higher net present value and higher internal rate of return than investment A D. A lower net present value and lower internal rate of return than investment A
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Two investments have the same initial cost and total revenue stream over a 5 year period. Investment A has an equal revenue stream and investment B generates significantly higher revenues the first three years. Based on this information investment B will likely generate:
A. A higher
B. A higher
C. A higher net present value and higher internal rate of return than investment A
D. A lower net present value and lower internal rate of return than investment A
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