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Explanation:
NEW QUESTION: 3
You are the project manager for the Late Night Smooth Jazz Club chain, with stores in 12 states. Smooth Jazz is considering opening a new club in Kansas City or Spokane. You have derived the following information:
Project Kansas City: The payback period is 27 months, and the IRR is 35 percent.
Project Spokane: The payback period is 25 months, and the IRR is 32 percent.
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A. Project Kansas City, because the payback period is the longest
B. Project Kansas City, because the IRR is the highest
C. Project Spokane, because the IRR is the lowest
D. Project Spokane, because the payback period is the shortest
Answer: B
Explanation:
Projects with the highest IRR value are favored over projects with lower IRR values.
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