Question & Answer: You are given a choice between Plan 1: $2,000 a year from now and $1,000 in two years OR Plan 2: $1,000 a year from now and…..

You are given a choice between Plan 1: $2,000 a year from now and $1,000 in two years OR Plan 2: $1,000 a year from now and $2,000 in two years. The interest rate is the same in both plans. Which has the higher RV 2 (A) (B) (C) (D) Plan 1 Plan 2 Plans 1 and 2 are equivalent It depends on the interest rate The IRR of a project is 10%. What is the project’s NPV if alternative unvestments have a 10% return ? (A) 10% (B) At least $1,000 (C) A negative number D Zero A project has an NPV of $1,250 at 10%. If you were to calculate the proects lRR, you should get a number bigger than 10% ? True False