You are considering the following two mutually exclusive projects. Both projects will be depreciated using straight-line depreciation to a zero book value over the life of the project. Neither project has any salvage value.
Should you accept or reject these projects based on net present value analysis?
A.
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accept Project A and reject Project B
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B.
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reject Project A and accept Project B
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C.
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accept both Projects A and B
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D.
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reject both Projects A and B
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E.
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You cannot make this decision based on net present value analysis.
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