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Consider two mutually exclusive projects Y and Z. thE projects have initial cash outflow of $1,000 at year 0. Cash inflows for project A in
Consider two mutually exclusive projects Y and Z. thE projects have initial cash outflow of $1,000 at year 0. Cash inflows for project A in year 1 and 2 are $1,150 and $100 respectively, cash inflows for project B in year 1 and 2 are $100 and $1,300 respectively.
both firm's cost of capital is 10%.
According to NPV method of project evaluation which project should be selected? (You must show your workings to support your answer)
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