A company is evaluating two competing investments. Investment X has a cost of $100,000 and a NPV estimated at $35,000. Investment Y has a cost of $220,000 and a NPV estimated at $35,500. Taking everything into account, you would recommend the company undertake which investment and why?
a. Neither investment is acceptable.
b. Not sure. Need additional information.
c. Take investment X, since it has almost the same value creating potential, but costs a fraction of Y. Do something else with the $120,000 saved up front.
d. Undertake investment Y as it produces more shareholder value.