Your company is considering two mutually exclusive projectsC and Rwhose costs and cash flows are shown in
Question:
Your company is considering two mutually exclusive projects—C and R—whose costs and cash flows are shown in the following table:
The projects are equally risky, and their required rate of return is 12 percent. You must make a recommendation concerning which project should be purchased. To determine which is more appropriate, compute the NPV and IRR of eachproject.
Transcribed Image Text:
Expected Net Cash Flows Year Project C Project R ,000 $(22,840) 8,000 6,000 2,000 3,000 8,000 8,000 8,000 8,000 3 4
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Calculator solution NPV C 125614 IRR C 173 Calculator solut...View the full answer
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