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1. (7%) Projects A and B have the following cash flows: C C C4 C: A -100 60 500 10 B -80 10 0 30

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1. (7%) Projects A and B have the following cash flows: C C C4 C: A -100 60 500 10 B -80 10 0 30 100 If a company uses the payback rule with a cutoff period of 2 years, which projects would it accept? Are these good decisions if the opportunity cost of capital is 10%? (ii)

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