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A firm is considering three projects, each with an initial outlay of $30,000. The firm's WACC is 8%. Project A has cash flows of $10,000
A firm is considering three projects, each with an initial outlay of $30,000. The firm's WACC is 8%. Project A has cash flows of $10,000 in year one, $5,000 in year two and in year three and $20,000 in year four. Project B has cash flows of $16,000 for years one, two and four and negative $16,000 in year three. Project C has one cash flow of $44,000 in year four. Which project would benefit most from an additional $10,000 inflow in year two?
Project A |
Project B |
Project C |
All projects benefit equally from the additional $8,573.39 to NPV |
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