2D4C LEWIS SERVICES IS EVALUATING SIX INVESTMENT OPPORTUNITIES (PROJE...
351.
CSO: 2D4b
LOS: 2D4c
Lewis Services is evaluating six investment opportunities (projects). The following table
reflects each project’s net present value (NPV) and the respective initial investments
required. All of these projects are independent.
Project
NPV
Investment
R
$ 5,000
$10,000
S
5,000
5,000
T
8,000
40,000
U
15,000
60,000
V
15,000
75,000
W
3,000
15,000
Lewis has an investment constraint of $100,000. Which combination of projects would
represent the optimal investment that should be recommended to Lewis Services’
management?
a.
R, S, U and W.
b.
R, V and W.
c.
R, S and V.
d.
T and U.