Question

Which of the following statements is true about mutually exclusive projects? a.Mutually exclusive projects are projects...

Which of the following statements is true about mutually exclusive projects?

a.Mutually exclusive projects are projects that, if accepted, do not affect the cash flows of other projects.

b.Mutually exclusive projects are projects that, if accepted, have a negative effect on the company's profit.

c.Mutually exclusive projects are those projects that, if accepted, preclude the acceptance of all other competing projects.

d.Mutually exclusive projects are projects that, if accepted, automatically lead to the acceptance of competing projects.

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Answer #1

The correct answer is

C) Mutually exclusive projects are project that , if accepted, preclude the acceptance of all other competing projects.

Explanation

Mutually exclusive project refers to the project in which only one project has to be selected from among all the projects and remaining all projects will be preclude from selection, that is why they are called mutually exclusive projects. Rest all other options are incorrect as mutually exclusive are not accepted if they have negative cash flows and competing projects are not selected.

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