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ch 22 A firm has two, mutually exclusive investment alternatives with the following cash inflows. The cost of capital is 7 percent. Year Cash Inflow

ch 22 A firm has two, mutually exclusive investment alternatives with the following cash inflows. The cost of capital is 7 percent.

Year Cash Inflow

A B

0 -$1,500 -$2,000

1 $275 $2,200

2 255 -

3 255 -

4 255 -

5 255 -

6 255 -

7 255 -

8 255 -

Based on NPV, which investment should you make?

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