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A construction company is bidding for two projects, Project P and Project Q. Project P requires an investment of $800,000 and is expected to generate
A construction company is bidding for two projects, Project P and Project Q. Project P requires an investment of $800,000 and is expected to generate annual profits of $140,000 for 5 years. Project Q requires an investment of $1,000,000 and is expected to generate annual profits of $200,000 for 7 years. If the company's required rate of return is 20%, which project should it choose based on the Net Present Value (NPV) criterion?
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