Discussion
For those same alternatives at a minimum attractive rate of 15 per cent, the choice is
Answer: A
Correct answer: the cheaper alternative, the increment failing the test
Nothing about the projects has changed - only the required rate. The increment earning 13 per cent no longer clears a 15 per cent hurdle, so the extra investment is not justified and the cheaper alternative wins. Both remain acceptable in themselves, since 22 and 16 per cent both exceed 15; it is the increment between them that fails.
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