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You Are Comparing Two Investments,A and B,with Unequal Annual Cash

Question 6

Multiple Choice

You are comparing two investments,A and B,with unequal annual cash flows and varying numbers of years.Which one of these statements is correct regarding this comparison?


A) If A has a higher present value at one discount rate,then A will have the higher present value at any other discount rate.
B) If B has a higher present value,then B will have the higher future value at any point in time,given a stated discount rate.
C) If B has a higher future value at one discount rate,then B will have the higher present value at any discount rate.
D) The two projects cannot be compared since they are of varying lengths.
E) The project with the greatest number of years will have the higher present value.

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