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Crockett Graphic Designs Ine. is considering two mutually exclusive projects. Both projects require an initial after-tax investinent of s11,oco and are fypical average-risk projects for

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Crockett Graphic Designs Ine. is considering two mutually exclusive projects. Both projects require an initial after-tax investinent of s11,oco and are fypical average-risk projects for the firm. Project A has an expected life of 2 years with after-tax cash inflows of $7,000 and $9,000 at the end of Years 1 and 2. respectively. Project B has an expected life of 4 years with after-tax cash inflows of 56,000 at the end of each of the next 4 years. The firm's Whac is 107 . a. If the projects cannot be repeated, which project should be selected if Crockett uses NPV as its criterion for project selection? Proiect sheuld be selected. b. Assume that the projects can be repeated and that there are no antipated changes in the cach flows. Use the replacement chain analysis to determine the Niv of the project selected Do not round intermediate calculations. Round your answer to the nearest cent. Since Project extended kipy=1 It sheuld be selected over Project c. Make the same assumptions as in part b. Using the equivalent aniual annuity (EAA) method, what is the AA of the project selected? Project should be selected. Crockett Graphic Designs Ine. is considering two mutually exclusive projects. Both projects require an initial after-tax investinent of s11,oco and are fypical average-risk projects for the firm. Project A has an expected life of 2 years with after-tax cash inflows of $7,000 and $9,000 at the end of Years 1 and 2. respectively. Project B has an expected life of 4 years with after-tax cash inflows of 56,000 at the end of each of the next 4 years. The firm's Whac is 107 . a. If the projects cannot be repeated, which project should be selected if Crockett uses NPV as its criterion for project selection? Proiect sheuld be selected. b. Assume that the projects can be repeated and that there are no antipated changes in the cach flows. Use the replacement chain analysis to determine the Niv of the project selected Do not round intermediate calculations. Round your answer to the nearest cent. Since Project extended kipy=1 It sheuld be selected over Project c. Make the same assumptions as in part b. Using the equivalent aniual annuity (EAA) method, what is the AA of the project selected? Project should be selected

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