In comparing these two alternatives,which is the correct evaluation?
A) Machine A should be purchased as the net present value of the costs of this alternative is the lowest.
B) Machine A should be purchased as the net present value of the costs of this alternative is the highest.
C) Machine B should be purchased as the net present value of the costs of this alternative is the lowest.
D) Machine B should be purchased as the net present value of the costs of this alternative is the highest.

Question

Quizplus · Accepted Answer

The correct evaluation is to choose the option with the lowest net present value of costs, as lower costs indicate a more financially viable option. Therefore, Machine B should be purchased as its net present value of costs is lower than that of Machine A.

In Comparing These Two Alternatives,which Is the Correct Evaluation