Question
ALL WORK MUST BE SHOWN Kong Inc. is considering two mutually exclusive projects, A and B. Project A costs $95,000 and is expected to generate
ALL WORK MUST BE SHOWN
Kong Inc. is considering two mutually exclusive projects, A and B. Project A costs $95,000 and is expected to generate $65,000 in year one and $35,000 in year two. Project B costs $120,000 and is expected to generate $64,000 in year one, $67,000 in year two, $51,000 in year three, and $15,000 in year four. The firm's required rate of return for these projects is 10%. The net present value for Project A is______________. (3 points)
Kong Inc. is considering two mutually exclusive projects, A and B. Project A costs $95,000 and is expected to generate $65,000 in year one and $35,000 in year two. Project B costs $120,000 and is expected to generate $64,000 in year one, $67,000 in year two, $51,000 in year three, and $15,000 in year four. Cruise, Inc.'s required rate of return for these projects is 10%. The profitability index for Project B is__________________.
ALL WORK MUST BE SHOWN
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