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An organization has four investment proposals with the following costs and expected cash inflows: Expected Cash Inflows Project Cost End of year 1 End of

An organization has four investment proposals with the following costs and expected cash inflows:

Expected Cash Inflows

Project

Cost

End of year 1

End of year 2

End of year 3

A

Unknown

$10,000

$10,000

$10,000

B

$20,000

5,000

10,000

15,000

C

25,000

15,000

10,000

5,000

D

30,000

20,000

Unknown

20,000

Additional information

Discount rate

Number of periods

Present value of $1 due at the end of n periods

Present value of an annuity of $1 per period for n periods

5%

1

0.9524

0.9524

5%

2

0.9070

1.8594

5%

3

0.8638

2.7232

10%

1

0.9091

0.9091

10%

2

0.8264

1.7355

10%

3

0.7513

2.4869

15%

1

0.8696

0.8696

15%

2

0.7561

1.6257

15%

3

0.6575

2.2832


a) If Project A has an internal rate of return (IRR) of 15%, then cost is?

    b) If the discount rate is 10%, the net present value (NPV) of Project B is?

    1. c) what is the payback period of Project C ?
    2. d) If the discount rate is 5% and the discounted payback period of Project D is exactly two years, then the year two cash inflow for Project D is?






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