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A firm with a 13% WACC is evaluating two projects (Y and 2) for this year's capital budget. After-tax cash flows are shown in
A firm with a 13% WACC is evaluating two projects (Y and 2) for this year's capital budget. After-tax cash flows are shown in the table below. Calculate NPV, IRR, MIRR, and payback for each project. Assuming the projects are independent, which one(s) would you recommend accepting? If the projects are mutually exclusive, which would you recommend accepting? (25 points) Time 13% Project Y Cash Flows Project Z Cash Flows (40,000.00) $ 15,000.00 $ 15,000.00 $ 15,000.00 $ 15,000.00 $ 15,000.00 $ 05 15 2 S 3 5 45 55 (120,000.00) 43,000.00 43,000.00 43,000.00 43,000.00 43,000.00 +
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SOLUTION To calculate the NPV IRR MIRR and payback period for each project we need to discount the cash flows using the weighted average cost of capit...Get Instant Access to Expert-Tailored Solutions
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