A firm has $10,000 to invest and there are three projects available. Project A needs an initial investment of $4,000 and has an NPV $10,000. Project B needs an initial investment of $6,000 and has an NPV of $1,000. Project C needs an initial investment of $5,000 and has an NPV of $1,500. Which projects should this firm take? b) A and B d) A and C a) A only c) B and C

Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter12: Capital Budgeting: Decision Criteria
Section: Chapter Questions
Problem 10P: Project S has a cost of $10,000 and is expected to produce benefits (cash flows) of $3,000 per year...
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A firm has $10,000 to invest and there are three projects available. Project A needs an initial investment of $4,000 and has an NPV
$10,000. Project B needs an initial investment of $6,000 and has an NPV of $1,000. Project C needs an initial investment of $5,000
and has an NPV of $1,500. Which projects should this firm take?
b) A and B
d) A and C
a) A only
c) B and C
Transcribed Image Text:A firm has $10,000 to invest and there are three projects available. Project A needs an initial investment of $4,000 and has an NPV $10,000. Project B needs an initial investment of $6,000 and has an NPV of $1,000. Project C needs an initial investment of $5,000 and has an NPV of $1,500. Which projects should this firm take? b) A and B d) A and C a) A only c) B and C
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