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Can you please build it in Excel Valley Products, Inc. is considering two independent investments having the following cash flow streams: Years Project A Project
Can you please build it in Excel
Valley Products, Inc. is considering two independent investments having the following cash flow streams:
Years | Project A | Project B |
0 | -50000 | -40000 |
1 | 20000 | 20000 |
2 | 20000 | 10000 |
3 | 10000 | 5000 |
4 | 5000 | 5000 |
5 | 5000 | 40000 |
Valley uses a combination of the net present value approach and the payback approach to evaluate investment alternatives. It requires that all projects have a positive net present value when cash flows are discounted at 10 percent and have a payback no longer than three years. Which project or projects should the firm accept? Why?
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