You are considering two projects with the following cash flows: Which of the following statements are true concerning these two projects?
I.Both projects have the same future value at the end of year 4, given a positive rate of return.
II.Both projects have the same future value given a zero rate of return.
III.Project X has a higher present value than Project Y, given a positive discount rate.
IV.Project Y has a higher present value than Project X, given a positive discount rate.

Question

You are considering two projects with the following cash flows:  Which of the following statements are true concerning these two projects?
I.Both projects have the same future value at the end of year 4, given a positive rate of return.
II.Both projects have the same future value given a zero rate of return.
III.Project X has a higher present value than Project Y, given a positive discount rate.
IV.Project Y has a higher present value than Project X, given a positive discount rate.

Quizplus · Accepted Answer

The Answer of You are considering two projects with the following cash flows:  Which of the following statements are true concerning these two projects?
I.Both projects have the same future value at the end of year 4, given a positive rate of return.
II.Both projects have the same future value given a zero rate of return.
III.Project X has a higher present value than Project Y, given a positive discount rate.
IV.Project Y has a higher present value than Project X, given a positive discount rate.

You Are Considering Two Projects with the Following Cash Flows