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When risk is the same, which project is preferred?

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Question

When risk is the same, which project is preferred?

Options

  • The project with the lower rate of return

  • The project with more receivables

  • The project with the higher rate of return

  • The project with more cash payments

MCQ
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Solution

When projects have the same risk, the higher-return project is preferred. For example, a project returning 12% is preferred over one returning 10% when their risk is equal.

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