Question
Goodiva Chocolatier has a maximum payback period of 6 years, and it must choose between two mutually exclusive projects A & B. The information for
Goodiva Chocolatier has a maximum payback period of 6 years, and it must choose between two mutually exclusive projects A & B.
The information for each project is presented in the table.
| Project A | Project B | |
| Initial investment | $25,000 | $35,000 |
| Year | Expected cash inflow | |
| 1 | $6,000 | $7,000 |
| 2 | $6,000 | $7,000 |
| 3 | $8,000 | $8,000 |
| 4 | $4,000 | $5,000 |
| 5 | $3,500 | $5,000 |
| 6 | $2,000 | $4,000 |
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The Theory And Practice Of Investment Management
Authors: Frank J Fabozzi, Harry M Markowitz
2nd Edition
0470929901, 9780470929902
