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Consider a firm with a budget constraint of $1m and five indivisible projects available to it as in the below table. Project Initial Outlay Net

Consider a firm with a budget constraint of $1m and five indivisible projects available to it as in the below table.

Project

Initial Outlay

Net Present Value

Project A

350,000

280,000

Project B

200,000

260,000

Project C

600,000

500,000

Project D

200,000

120,000

Project E

280,000

270,000

  1. Which project should be accepted? Justify your answer.

Note: No hand writing !

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