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All techniques with NPV profileMutually exclusive projects Projects A and B. of equal risk, are alternatives for expanding Rosa Company's capacity. The firm's cost of
All techniques with NPV profileMutually exclusive projects Projects A and B. of equal risk, are alternatives for expanding Rosa Company's capacity. The firm's cost of capital is 15%. The cash flows for each project are shown in the following table: a. Calculate each project's payback period. b. Calculate the net present value (NPV) for each project. c. Calculate the internal rate of return (IRR) for each project. d. Indicate which project you would recommend. Data Table a. The payback period of project A is years. (Round to two decimal places.) The payback period of project Bis years. (Round to two decimal places.) (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet.) b. The NPV of project A is $ (Round to the nearest cent.) Project A $80,000 Project B $50,000 The NPV of project B is $. (Round to the nearest cent.) Initial investment (CF) Year (0) C. The IRR of project Ais %. (Round to two decimal places.) The IRR of project Bis%. (Round to two decimal places.) 1 2 Cash inflows (CF) $15,000 $15,000 $20,000 $15,000 $25,000 $15,000 $30,000 $15,000 $35,000 $15,000 d. Which project will you recommend? (Select the best answer below.) 3 4 5 O A. Project A O B. Project B Print Done
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