Projects are mutually exclusive if picking one project eliminates the ability to pick the other project.This mutually exclusive situation can arise for different reasons.Which of the statements below is NOT one of these reasons?
A)One project will always have a negative NPV.
B)There is a scarce resource that both projects would need.
C)There is need for only one project,and both projects can fulfill that current need.
D)By using funds for one project,there are not enough funds available for the other project.

Question

Quizplus · Accepted Answer

The statement "One project will always have a negative NPV" is not a reason for projects to be mutually exclusive. Mutually exclusive projects are projects that cannot be pursued simultaneously due to limitations in resources or conflicting objectives. Negative NPV may be a reason to reject a project, but it does not necessarily make a project mutually exclusive with another project.

Projects Are Mutually Exclusive If Picking One Project Eliminates the Ability