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Consider projects A and B with the following cash flows: A -$42 67 C1 +$26 + 36 C2 +$26 + 36 C3 +$ 26 +
Consider projects A and B with the following cash flows: A -$42 67 C1 +$26 + 36 C2 +$26 + 36 C3 +$ 26 + 36 B a-1. What is the NPV of each project if the discount rate is 10%? (Do not round intermediate calculations. Round your answers to 2 decimal places.) a-2. Which project has the higher NPV? b-1. What is the profitability index of each project? (Do not round intermediate calculations. Round your answers to 2 decimal places.) b-2. Which project has the higher profitability index? c. Which project is most attractive to a firm that can raise an unlimited amount of funds to pay for its investment projects? d. Which project is most attractive to a firm that is limited in the funds it can raise? Answer is not complete. Project A Project B NPV of each project if the discount rate is 10% $ 13.74 X $ 12.17 X Which project has the higher NPV? a- 1. a- 2. b- 1. b- 2. Profitability index of each project Project A C. Which project has the higher profitability index? Which project is most attractive to a firm that can raise an unlimited amount of funds to pay for its investment projects? Which project is most attractive to a firm that is limited in the funds it can raise? Both d. Project A
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