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Lambert Manufacturing Has $100,000 to Invest in Either Project a or Project

Question 153

Multiple Choice

Lambert Manufacturing has $100,000 to invest in either Project A or Project B. The following data are available on these projects (Ignore income taxes.) : Lambert Manufacturing has $100,000 to invest in either Project A or Project B. The following data are available on these projects (Ignore income taxes.) :   Click here to view Exhibit 14B-1 and Exhibit 14B-2, to determine the appropriate discount factor(s)  using the tables provided.Both projects will have a useful life of 6 years and the total cost approach to net present value analysis. At the end of 6 years, the working capital investment will be released for use elsewhere. Lambert's required rate of return is 14%.The net present value of Project B is: A)  $90,355 B)  $76,115 C)  $36,115 D)  $54,355 Click here to view Exhibit 14B-1 and Exhibit 14B-2, to determine the appropriate discount factor(s) using the tables provided.Both projects will have a useful life of 6 years and the total cost approach to net present value analysis. At the end of 6 years, the working capital investment will be released for use elsewhere. Lambert's required rate of return is 14%.The net present value of Project B is:


A) $90,355
B) $76,115
C) $36,115
D) $54,355

Correct Answer:

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