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All techniques Decision among mutually exclusive investments Pound Industries is attempting to select the best of three mutually exclusive projects. The initial investment and after-tax

All techniques Decision among mutually exclusive investmentsPound Industries is attempting to select the best of three mutually exclusive projects. The initial investment and after-tax cash inflows associated with these projects are shown in the following table.

Cash flows

Project A

Project B

Project C

Initial investment (CF)

$60,000

$90,000

$100,000

Cash inflows (CF), t=1 to 5

$20,000

$31,500

$33,000

a.Calculate the payback period for each project.

b.Calculate the net present value (NPV) of each project, assuming that the firm has a cost of capital equal to 8%.

c.Calculate the internal rate of return (IRR) for each project.

d.Indicate which project you would recommend.

(round to two decimals)

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