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Assume a $50,000 investment and the following cash flows for two alternatives: (Negative answers should be indicated by a minus sign.) Year Investment A Investment
| Assume a $50,000 investment and the following cash flows for two alternatives: (Negative answers should be indicated by a minus sign.) |
| Year | Investment A | Investment B | |
| 1 | $10,000 | $20,000 | |
| 2 | 11,000 | 25,000 | |
| 3 | 13,000 | 15,000 | |
| 4 | 16,000 | ||
| 5 | 30,000 | ||
| Calculate the net present value for investment A, using a 15 percent discount rate. |
| Net Present Value | $ |
| Calculate the net present value for investment B, using a 15 percent discount rate. |
| Net Present Value | $ |
| Which of the alternatives would you select under the net present value method? | ||||||
|
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Corporate Financial Management
Authors: Glen Arnold
4th Edition
0273719068, 978-0273719069
