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1. Blue Bird Corporation is considering the following mutually exclusive projects. Expected cash Flows 701234 Year Project A Project B Tk (3,500) Tk (3,500)
1. Blue Bird Corporation is considering the following mutually exclusive projects. Expected cash Flows 701234 Year Project A Project B Tk (3,500) Tk (3,500) 2,700 500 1,000 1,000 1,200 2,200 400 500 The required rate of return on the projects is 10%. Expected payback period is 2.5 years and discounted payback period is 3 years. The cashflows will be reinvested at 8% rate of return. If the projects are mutually exclusive which projects should be accepted on the basis of: a) Payback period b) Discounted payback period c) NPV method d) IRR method e) MIRR method f) PI g) EAA method
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To evaluate the projects based on different methods lets calculate the relevant measures for each project Project A Year 0 Tk 3500 Year 1 Tk 2700 Year 2 Tk 1000 Year 3 Tk 400 Year 4 Tk 500 Project B Y...Get Instant Access to Expert-Tailored Solutions
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Step: 3
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