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12-2: Net Present Value (NPV). Capital budgeting criteria: mutually exclusive projects Project S costs $19,000 and its expected cash flows would be $6,000 per year
12-2: Net Present Value (NPV). Capital budgeting criteria: mutually exclusive projects Project S costs $19,000 and its expected cash flows would be $6,000 per year for 5 years. Mutually exclusive Project L costs $44,500 and its expected cash flows would be $10,200 per year for 5 years. If both projects have a WACC of 15%, which project would you recommend? Select the correct answer. O I. Project S, since the NPVS > NPVL. II. Both Projects S and L, since both projects have NPV's >0. III. Neither Sor L, since each project's NPV 0. V. Project L, since the NPVL > NPVS
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