Question
Consider the following two mutually exclusive projects: Cash Flow (A) $ 356,000 , 39,000 , 59,000 , 59,000 434,000 Cash Flow (B) $ 47,000 ,
Consider the following two mutually exclusive projects:
Cash Flow (A) $ 356,000 , 39,000 , 59,000 , 59,000 434,000
Cash Flow (B) $ 47,000 , 23,400 , 21,400 , 18,900 , 14,000
Whichever project you choose, if any, you require a return of 15 percent on your investment.
What is the payback period for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)
If you apply the payback criterion, which investment will you choose?
What is the discounted payback period for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) If you apply the discounted payback criterion, which investment will you choose?
What is the NPV for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)
What is the IRR for each project? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)
What is the profitability index for each project? (Do not round intermediate calculations and round your answers to 3 decimal places, e.g., 32.161.)
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