Question
Consider two independent projects, A and B, with cash flows presented. Assume that the cost of capital, e the required rate of return is 14%.
Consider two independent projects, A and B, with cash flows presented. Assume that the cost of capital, e the required rate of return is 14%.
Note the Year 0 cash flow represents the initial cost of each project.
Expected t After-Tar Cash Flows 2 $400 1950 $3,000 43,000 $900 $700.
a. What is the average accounting rate of return (ARR) for project A $250 $550 $350 $500 Number.
b. What is the average accounting rate of return (ARR) for project 87 Number.
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