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Arvind Mills Ltd . is considering two mutually exclusive investment proposals for its expansion progrens Proposal A requires an initial investment of 7 , 5

Arvind Mills Ltd. is considering two mutually exclusive investment proposals for its expansion progrens Proposal A requires an initial investment of 7,50,000 and yearly cash operating costs of 50,000P. B requires an initial investment of 5,00,000 and yearly cash operating costs of 1,00,000. The life ds equipment used in both the investment proposals will be 12 years, with no salvage value; depreciation is the straight-line basis for tax purposes. The anticipated increase in revenues is 1,50,000 per year in bobs investment proposals. The firm's tax rate is 35% and its cost of capital is 15%. Which investment proposal should be undertaken by the company?
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