Project Eh! requires an initial investment of $50,000, and has a net present value of $12,000. Project B requires an initial investment of $100,000, and has a net present value of $13,000. The projects are proposals for increasing revenue and are not mutually exclusive. The firm should accept
A) project Eh!.
B) project B.
C) both projects.
D) neither project.

Question

Quizplus · Accepted Answer

Both projects have a positive net present value, indicating that they will generate a return on investment. As they are not mutually exclusive, accepting both projects would maximize the firm's revenue. However, it's important to note that initial investment amounts should also be considered before making a decision, as project B requires a higher investment upfront.

Project Eh! Requires an Initial Investment of $50,000, and Has