Question
1. Briefly explain the four capital budgeting methods including NPV, IRR, PI, and payback. Company XYZ is considering two mutually exclusive projects. Both projects
1. Briefly explain the four capital budgeting methods including NPV, IRR, PI, and payback. Company XYZ is considering two mutually exclusive projects. Both projects are of equal risk and has discount rate of 15%. The cash flows of the two projects are as follows: Years 0 1 2 3 4 A -600 100 150 430 590 B -700 550 340 170 100 a. Find NPV, IRR, PI, and payback of two projects respectively (show calculations for possible partial credit). b. What is your decision between the two projects and why?
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Entrepreneurship
Authors: Andrew Zacharakis, William D Bygrave
5th Edition
9781119563099
