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Assignment / i Saved Help 3 Problem 8-29 NPV Payback and (LO 1, LO4) Here are the expected cash flows for three projects: 10 points
Assignment / i Saved Help 3 Problem 8-29 NPV Payback and (LO 1, LO4) Here are the expected cash flows for three projects: 10 points Year: 4 Project B - 6,900 - 2,990 - 6,900 Cash Flows (dollars) 1 2. 3 + 1,475 + 1,475 + 3,950 + 2,900 + 2,950 1,475 + 1,475 + 3,950 + 3,950 + 5,950 eBook Print a. What is the payback period on each of the projects? b. If you use the payback rule with a cutoff period of 2 years, which projects will you accept? c. If you use a cutoff period of 3 years, which projects will you accept? d-1. If the opportunity cost of capital is 12%, calculate the NPV for projects A, B, and C. (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to 2 decimal places.) d-2. Which projects have positive NPVs? e. "Payback gives too much weight to cash flows that occur after the cutoff date." True or false? References Project A Years Project B Years Project C Years a. Payback period b. If you use the payback rule with a cutoff period of 2 years, which projects will you accept? C. If you use a cutoff period of 3 years, which projects will you accept? d-1. If the opportunity cost of capital is 12%, calculate the NPV for projects A, B, and C. d-2. Which projects have positive NPVs? "Payback gives too much weight to cash flows that occur after the cutoff date." True or false? e
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