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1. X company is planning on a project with an initial investment of $5,025 and will generate cash flow for the following 2 years with

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1. X company is planning on a project with an initial investment of $5,025 and will generate cash flow for the following 2 years with first year $3,300, second year $4,840. The project will be terminated at the end of the second year. If the discount rate is 0.5%, the net present value of this project is If the discount rate is estimated at 20.5%, the net present value of this project will be changed to S (42) The management team is also considering another project with similar cash flow and its discount rate is estimated at 17.5%, if a decision has to be made between the two project, we should recommend the management team to choose the project with discount rate of (43)

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