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22. (Related to Checkpoint 11.1, Checkpoint 11.3, and Checkpoint 11.4) (Net present value, profitability index, and internal rate of return calculations) You are considering two
22.
(Related to Checkpoint 11.1, Checkpoint 11.3, and Checkpoint 11.4) (Net present value, profitability index, and internal rate of return calculations) You are considering two independent projects, Project A and Project B. The initial cash outlay associated with Project A is $52,000 and the initial cash outlay associated with Project B is $72,000. The discount rate on both projects is 10.5 percent. The expected annual cash flows from each project are as follows: Year Project A Project B 0 $(52,000) $(72,000) 1 12,000 13,000 2 12,000 13,000 3 12,000 13,000 4 12,000 13,000 5 12,000 13,000 6 12,000 13,000 (Click on the icon in order to copy its contents into a spreadsheet.) Calculate the NPV, PI, and IRR for each project and indicate if the project should be accepted or not. a. The NPV of Project A is $ (Round to the nearest cent.)Step by Step Solution
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