Question
An analyst has gathered the following data about a company with a 12% cost of capital: Project A Project B Cost $15,000 $25,000 Life 5
An analyst has gathered the following data about a company with a 12% cost of capital:
| Project A | Project B | |
| Cost | $15,000 | $25,000 |
| Life | 5 years | 5 years |
| Cash inflows | $5,000/year | $7,500/year |
Projects A and B are mutually exclusive. What should the company do?
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Principles of Managerial Finance
Authors: Chad J. Zutter, Scott B. Smart
15th edition
013447631X, 134476315, 9780134478197 , 978-0134476315
