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Following is information on two alternative investments projects being considered by Tiger Company. The company requires an 8% return from its investments. (PV of
Following is information on two alternative investments projects being considered by Tiger Company. The company requires an 8% 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.) Initial investment Project X1 $ (81,000) Project X2 $ (124,000) Net cash flows in: Year 11 29,000 66,000 39,500 64,500 56,000 46,000 Year 2 Year 31 a. Compute each project's net present value. b. Compute each project's profitability index. 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. Required A Required B Compute each project's net present value. (Round your answers to the nearest whole dollar.) Present Value of Present Value of 1 at 8% Net Cash Flows Project X1 Year 11 $ 29,000 0.9259 Year 2 39,500 0.8573 Net Cash Flows
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