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A firm has estimated cash flows for three possible four-year projects. The cash flows are shown below: YEAR01234Project A cash flows-$40$12$12$12$12Project B cash flows-$50$16$16$16$16Project C
A firm has estimated cash flows for three possible four-year projects. The cash flows are shown below:
YEAR01234Project A cash flows-$40$12$12$12$12Project B cash flows-$50$16$16$16$16Project C cash flows-$35$11$11$11$11Suppose that the projects are mutually exclusive and the cost of capital is 8.5%.
What is your decision?
- Reject projects A, B. C
- Accept projects A, B, and C
- Accept project C
- Accept projects B and C only
- Accept project B only
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