Use the following information to answer questions 13 - 15
The following data is on two one period capital projects.
-What is the variance of each project's cash flow?
A) A = 25,500, B = 9,700
B) A = 50,100. B = 19,400
C) A = 75,200, B = 29,100
D) A = 100,200, B = 38,800
E) A = 125,400, B = 48,500

Question

Use the following information to answer questions 13 - 15
The following data is on two one period capital projects. 
-What is the variance of each project's cash flow?
A) A = 25,500, B = 9,700 
B) A = 50,100. B = 19,400 
C) A = 75,200, B = 29,100 
D) A = 100,200, B = 38,800 
E) A = 125,400, B = 48,500

Quizplus · Accepted Answer

Project A has a variance of (5,000)^2 = 25,000,000 and Project B has a variance of (4,300)^2=18,490,000. Therefore, Project B has the lower variance and is the better choice.

Use the Following Information to Answer Questions 13 - 15