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  1. business
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  3. you are going to choose between two investments. b

You are going to choose between two investments. Both cost $50,000, but investment A pays...

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Finance

  1. You are going to choose between two investments. Both cost $50,000, but investment A pays $25,000 a year for three years while investment B pays $20,000 a year for 4 years. If your required return is 12%, which should you choose?

    A.

    A because it has a higher IRR.
    B.

    B because its IRR exceeds 12%
    C.

    B because it has a higher NPV.
    D.

    A because it pays back sooner.
    E.

    A because its IRR exceeds 12%
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You are going to choose between two investments. Both cost $50,000, but investment A pays $25,000 a year for three years while investment B pays $20,000 a year for 4 years. If your required return is 12%, which should you choose? A. A because it has a higher IRR. B. B because its IRR exceeds 12% C. B because it has a higher NPV. D. A because it pays back sooner. E. A because its IRR exceeds 12%

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