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A firm with a 14% WACC is evaluating two Projects for this year's capital budget. After Tax cash flows, including deprecation, are as follows: 0_________________1________________2_______________3_______________4______________5____
A firm with a 14% WACC is evaluating two Projects for this year's capital budget. After Tax cash flows, including deprecation, are as follows:
0_________________1________________2_______________3_______________4______________5____
object-M-$30,000 $10,000 $10,000 $10,000 $10,000 $10,000
object-N-$90,000 $28,000 $28,000 $28,000 $28,000 $28,000
A: Calculate NPV, IRR, MIRR, Payback and discounted payback for each project,
B: Assuming the projects are independent, which one(s) would you recommend?
Capital Budgeting criteria: Ethical considerations.
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