Question
Bajaw, Inc., are currently evaluating the following two projects: Year Cashflow (A) Cashflow (B) 0 -80,000 -100,000 1 45,000 10,000 2 25,000 40,000 3
Bajaw, Inc., are currently evaluating the following two projects:
Year | Cashflow (A) | Cashflow (B) |
0 | -80,000 | -100,000 |
1 | 45,000 | 10,000 |
2 | 25,000 | 40,000 |
3 | 20,000 | 45,000 |
4 | 10,000 | 120,000 |
Assuming the discount rate is 10% Select the best project according to each of the following evaluation method? (Make sure you show your final calculation for each evaluation method used)
-Payback period
-NPV for project
-IRR for project
-PI for project
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Solution Here are the calculations for each evaluation method 1 Payback Period Project A Year 1 80000 45000 35000 Year 2 35000 25000 10000 Year 3 1000...Get Instant Access to Expert-Tailored Solutions
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Fundamentals Of Corporate Finance
Authors: Stephen A. Ross, Randolph Westerfield, Bradford D. Jordan
6th Edition
0072553073, 9780072553079
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