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Could you please show the formulas in Excel. 7. Two mutually exclusive investment projects have the following forecasted cash flows: Years A B 0 ($20,000)
Could you please show the formulas in Excel.
7. Two mutually exclusive investment projects have the following forecasted cash flows:
Years | A | B |
0 | ($20,000) | ($20,000) |
1 | 10,000 | 0 |
2 | 10,000 | 0 |
3 | 10,000 | 0 |
4 | 10,000 | $60,000 |
a. Compute the internal rate of return for each project.
b. Compute the net present value for each project if the firm has a 10 percent cost of capital.
c. Which project should be adopted? Why?
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