Goliath Hotel projects the cash flows for three alternative investment projects (in 000) as: Depreciation is 70,000

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Goliath Hotel projects the cash flows for three alternative investment projects (in £’000) as:

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Depreciation is £70,000 per annum. For each project, calculate the:

• payback period;

• accounting rate of return (average);

• net present value (assuming a cost of capital of 9%); 

• comment on which (if any) project should be accepted.

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