29. You are considering two independent projects. Project A has an initial cost of $125,000 and cash inflows of $46,000, $79,000, and $51,000 for years I to 3, respectively. Project B costs S135,000 with expected cash inflows for years I to 3 of $50,000, S30,000, and S100,000, respectively. The required return for both projects is 16 percent. Based on IRR, you shoulkd a. Accept Project B and reject Project A b. Reject both projects. c. Accept both projects. d. Accept Project A and reject Project B e. Accept either one of the projects, bat not both Answer 30. A project has an initial cost of S6,700. The cash inflows are $850, $2,400, s3,300, and $4,100 over the next four years, respectively. What is the payback period a 3.94 years b. 3.04 years c. 2.51 years d. 3.51 years e. 3.73 years Answer:- 31. Net present value: a. Is very similar in its methodology to the average accounting return. b. Is the best method of analyzing mutually exclusive projects c. Is less useful than the internal rate of return when comparing different sized projects. d. Cannot be applied when comparing mutually exclusive projects. e. Is the easiest method of evaluation for nonfinancial managers to use. Answer: 32. A project has an initial cash outflow of $39.800 and produces cash inflows of $18,304, S19.516, and $14,280 for years 1 through 3, respectively. What is the NPV at a discount rate of II percent? a. -$1.208.19 b. $2,029.09 c. $7,675.95 d. $1,311.16 e. $2,971.13