Which figure is higher

Exercise and reference answers

Questions

1. A

   Payback of four years

   B

   Payback of five years

   Higher value

   Payback of five years

2. A

   NPV of the machine project

   B

   NPV of the panel project

   Higher value

   NPV of the panel project

3. A

   A crossover rate of 14%

   B

   A crossover rate of 13.43%

   Higher value

   A crossover rate of 14%

4. A

   PI when NPV is above zero

   B

   PI when NPV is below zero

   Higher value

   PI when NPV is above zero

5. A

   NPV at a low discount rate

   B

   NPV at a high discount rate

   Higher value

   NPV at a low discount rate

Instructions

Tap the side with the higher value.

Explanation