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6) Two software project alternatives have the following cash flows (all units in $): Year Project A 0 -2000 1 +800 2 +800 3 +800

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6) Two software project alternatives have the following cash flows (all units in $): Year Project A 0 -2000 1 +800 2 +800 3 +800 Project B -2800 +1100 +1100 +1100 Draw a cash flow diagram for each alternative. 6a) At a 5% interest rate, which alternative should be selected by NPV comparison? 6b) At a 6% interest rate, which alternative should be selected by NPV comparison? 6c) At a 7% interest rate, which alternative should be selected by NPV comparison? 6d) Now perform the same comparison, looking at net future value (NFV) at the end of year 3. Does an NFV comparison change any of your decisions from 6a, 6b, or 6c

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