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10.4 (LG 10.4) The following data are available for two mutually exclusive projects: Project B $15.000.000 PW(benefits) Project A $19 000 000 PW(operating and
10.4 (LG 10.4) The following data are available for two mutually exclusive projects: Project B $15.000.000 PW(benefits) Project A $19 000 000 PW(operating and maintenance costs) 5 000 000 8 000 000 PW(capital cost) 5 000 000 1 000 000 a. Compute the benefit-cost ratios for both projects. b. Compute the modified benefit-cost ratios for both projects. c. Compute the benefit-cost ratio for the increment between the projects. d. Compute the present worths of the two projects. e. Which is the preferred project? Explain.
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Corporate Finance and Investment decisions and strategies
Authors: Richard Pike, Bill Neale, Philip Linsley
8th edition
1292064064, 978-1292064161, 1292064161, 978-1292064062
