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Lukashylo Lukashylo
wrote...
6 years ago
Let A and B be two mutually exclusive projects. Suppose the present worth of incremental
investment B-A is a positive number. Then,

a) The present worth of A is greater than the present worth of B.
b) The present worth of B is greater than the present worth of A.
c) The present worth of A is equal to the present worth of B.
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Replies
wrote...
Staff Member
6 years ago
Since PWB-A(i)=PWB(i)-PWA(i), PWB-A(i)>0 implies PWB(i)>PWA(i). The correct answer is B
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