Use the table for the question(s)below. Consider the following two projects: -Assume that projects Alpha and Beta are mutually exclusive.The correct investment decision and the best rational for that decision is to: A)invest in project Beta,since NPV_Beta 0. B)invest in project Alpha,since NPV_Beta IRR_Alpha. D)invest in project Beta,since NPV_Beta NPV_Alpha 0. E)invest in project Alpha,since IRR_Alpha IRR_Beta.

Question

Use the table for the question(s)below. Consider the following two projects: -Assume that projects Alpha and Beta are mutually exclusive.The correct investment decision and the best rational for that decision is to: A)invest in project Beta,since NPV_Beta > 0. B)invest in project Alpha,since NPV_Beta < NPV_Alpha. C)invest in project Beta,since IRR_Beta > IRR_Alpha. D)invest in project Beta,since NPV_Beta > NPV_Alpha> 0. E)invest in project Alpha,since IRR_Alpha > IRR_Beta.

Quizplus · Accepted Answer

The best investment decision is to invest in project Beta, as it has a higher net present value (NPV) than project Alpha. The NPV for Beta is calculated as $2,805 ($5,000 - $2,195), while the NPV for Alpha is only $1,250 ($3,250 - $2,000). Therefore, investing in project Beta will result in a higher return on investment than investing in project Alpha.

Use the Table for the Question(s)below