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Consider the following cash flows on two mutually exclusive project: Project A and Project B. The cash flows for Project A are expressed in real
Consider the following cash flows on two mutually exclusive project: Project A and Project B. The cash flows for Project A are expressed in real dollar terms, whereas those of Project B are expressed in nominal terms. The appropriate nominal discount rate is 13%, and the inflation rate is 4%. Calculate the net present value (NPV) for Project A. (Round to 2 decimals)
Year | Project A | Project B |
0 | -60,000 | -82,000 |
1 | 30,000 | 29,000 |
2 | 25,000 | 38,000 |
3 | 20,000 | 41,000 |
4 | 15,000 | 22,000 |
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