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Consider the following two projects: Cash flows Project A Project B C 0 $ 150 $ 150 C 1 60 75 C 2 60 75
Consider the following two projects:
Cash flows | Project A | Project B | ||||
C0 | $ | 150 | $ | 150 | ||
C1 | 60 | 75 | ||||
C2 | 60 | 75 | ||||
C3 | 60 | 75 | ||||
C4 | 60 | |||||
|
- What is the payback period of each project?
- Is the project with the shortest payback period also the one with the highest NPV?
- What are the internal rates of return on the two projects?
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