Halloran, Inc Which of the Reasons Below Is True Concerning the Acceptability

Halloran, Inc. is planning a capital investment. The company has a 7.8% required rate of return and a 6.3% cost of capital. Results of its budgeting calculations for three possible investments, each with a 7-year expected useful life and no salvage value, follow:
$\begin{array}{|c|c|c|c|} \hline& \text { Payback Period Method } & \text { Net Present Value } & \text { Cost } \\\hline \text { Project 22 } & 5.2 & \$ 2,000 & \$ 125,000 \\\hline \text { Project 33 } & 6.9 & (\$ 2,000) & 62,000 \\\hline \text { Project } 77 & 7.5 & \$ 0 & 71,000\\\hline\end{array}$
Which of the reasons below is true concerning the acceptability of a particular project?

A) Project 33 incurs a net loss.
B) Project 33 generates a return that is less than the required rate of return.
C) The cash invested in Project 77 requires an additional half year to recover when compared to Project 22.
D) Project 77 will operate at breakeven.