Project A and project B have the same salvage value. The life of project A is 10 years while the life of project B is 8 years. Which project will yield the higher present value for the salvage value? a. Project A b. Project B c. Indeterminate d. depends on the rate to be used

Project A and project B have the same salvage value. The life of project A is 10 years while the life of project B is 8 years. Which project will yield the higher present value for the salvage value? a. Project A b. Project B c. Indeterminate d. depends on the rate to be used

Financial Management: Theory & Practice

16th Edition

ISBN:9781337909730

Author:Brigham

Publisher:Brigham

Chapter10: The Basics Of Capital Budgeting: Evaluating Cash Flows

Section: Chapter Questions

Problem 12MC: You are also considering another project that has a physical life of 3 years—that is, the machinery...

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Question

Project A and project B have the same salvage value. The life of project A is 10 years while the life of project B is 8 years. Which project will yield the higher present value for the salvage value?

a. Project A
b. Project B
c. Indeterminate
d. depends on the rate to be used

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