Which of the following is not considered a lagging economic


1. Which of the following is NOT considered a lagging economic indicator?

prime rate

change in CPI for services

industrial production

commercial and industrial loans

consumer expectations index

2. Your division is considering two projects with the following net cash flows (in millions):

0 1 2 3

Project A -$30 $10 $15 $22

Project B -$25 $15 $14 $11

If the WACC were 5% and Projects A and B were mutually exclusive, which project would you choose?

a) Project A

b) Project B

c) Neither

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Financial Management: Which of the following is not considered a lagging economic
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