A company is considering two mutually exclusive projects, an analysis of which is given below:
The company's cost of capital is 12%.
Assuming an objective of maximising shareholders' wealth, which project would be recommmended?
Project B because it has the higher net present value.
Project B because it has the shorter payback period.
Project A because it has the higher accounting rate of return.
Project A because it has the higher internal rate of return.
Submit