Consider the timing of the profits of the following certain investment projects: Profit
L S
Year 1 $ 0 $ 3000
Year 2 $ 3000 $ 0
A)Project S is preferred to Project L.
B)Project L is preferred to Project S.
C)Projects S and L are equally desirable.
D)A goal of profit maximisation would favor Project S only.

Question

Quizplus · Accepted Answer

Project S provides immediate profit in Year 1, which is generally preferred due to the time value of money, making it more desirable than Project L, which provides profit in Year 2.

Consider the Timing of the Profits of the Following Certain