A. project A and project b are mutually exclusive. The two projects in terms of

ID: 2702668 • Letter: A

Question

A. project A and project b are mutually exclusive. The two projects in terms of NPV at a discount

rate labeled the crossover rate.

B. Project A has a higher y - axis intercept for its NPV profile than mutuall exclusive Project B.

As we proceed past the crossover rate to the right on the x - axis, project B's profile will be above projects A's profile.

C. Project A has a higher y - axis intercept for its NPV profile than mutuall exclusive Project B. As long

as the profile of project A is above the profile of project B, project A will have a higher NPV value for the

particular discount rate

D. Project A has a higher y - axis intercept for its NPV profile than mutuall exclusive Project B.

This means that project A has a lower NPV than project B when the discount rate is zero.

Project A has a higher y - axis intercept for its NPV profile than mutuall exclusive Project B. As long

as the profile of project A is above the profile of project B, project A will have a higher NPV value for the

particular discount rate

C is wrong

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