Answered You can hire a professional tutor to get the answer.
Fargo Industries uses the Net Present Value method to make investment decisions and requires a 15% return on all investments. The company is...
Fargo Industries uses the Net Present Value method to make investment decisions and requires a 15% return on all investments. The company is considering two different investments. Each requires an initial investment of $15,000 and will produce cash flows as follows:
Investment A Year 1: $8000, Year 2: $8000, Year 3: $80000
Investment B Year 1: 0, Year 2:0, Year 3: $24000
Which of the following is NOT true concerning these investments?
A.The payback period for Investment A is shorter than that for Investment B.
B.Investment B carries higher risk than Investment A.
C.The net present value of these investments is the same.
D.The internal rate of return of Investment A exceeds that of Investment B.
