Evaluate the following cash flows for three independent projects: Year Project 1 Project 2 Project 3 0
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Question:
Evaluate the following cash flows for three independent projects:
Year | Project 1 | Project 2 | Project 3 |
0 | -$10,000 | -$12,000 | -$8,000 |
1 | $3,000 | $4,000 | $2,000 |
2 | $3,000 | $4,000 | $2,000 |
3 | $3,000 | $4,000 | $2,000 |
4 | $3,000 | $4,000 | $2,000 |
a) Calculate the NPV at a 7% discount rate. b) Determine the payback period for each project. c) Which project should be selected if the payback cutoff is 3 years?
Expert Answer:
Related Book For 
Introduction To Mathematical Statistics
ISBN: 9780321794710
7th Edition
Authors: Robert V., Joseph W. McKean, Allen T. Craig
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