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club in Kansas City or Spokane. You have derived the following information:
Project Kansas City: The payback period is months, and the IRR is percent.
Project Spokane: The payback period is months, and the IRR is percent.
Which project should you recommend to the selection committee?
A. Project Kansas City, because the IRR is the highest
B. Project Kansas City, because the payback period is the longest
C. Project Spokane, because the IRR is the lowest
Answer: A
Explanation:
Projects with the highest IRR value are favored over projects with lower IRR values.