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Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 $344,371 $15,617 1 28,800 5,239 2 58,000 8,576 3 52,000
Consider the following two mutually exclusive projects:
Year | Cash Flow (A) | Cash Flow (B) |
0 | $344,371 | $15,617 |
1 | 28,800 | 5,239 |
2 | 58,000 | 8,576 |
3 | 52,000 | 13,631 |
4 | 422,000 | 8,710 |
Whichever project you choose, if any, you require a 6 percent return on your investment.
a) What is the discounted payback period for Project A and what is the discounted payback period for Project B?
b) What is the NPV for Project A and what is the NPV .for Project B?
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