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Following is information on two alternative investment projects being considered by Tiger Company. The company requires a 7% return from its investments. (PV of
Following is information on two alternative investment projects being considered by Tiger Company. The company requires a 7% return from its investments. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Project X2 $ (152,000) Initial investment Project X1 $ (96,000) Net cash flows in: Year 1 33,000 72,000 Year 2 .43,500 62,000 Year 3 68,500 52,000 a. Compute each project's net present value. b. Compute each project's profitability index. c. If the company can choose only one project, which should it choose on the basis of profitability index? Complete this question by entering your answers in the tabs below.
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