consider the following cash flows on two nut

CHAPTER 6 Making Capital Investment Decisions 199 15. Capital Budgeting with Inflation exclusive projects: Consider the following cash flows on two mutually Year Project A -$30,000 18,000 16,000 12,000 Project B $45,000 21,000 23,000 25,000 0 The cash flows of Project A are expressed in real terms, whereas those of Project B are expressed in nominal terms. The appropriate nominal discount rate is 13 percent and the inflation rate is 4 percent. Which project should you choose