Question
Hani Group, a consumer electronics conglomerate, is reviewing its annual budget in wireless technology. It is considering investments in two different technologies to develop wireless
Hani Group, a consumer electronics conglomerate, is reviewing its annual budget in wireless technology. It is considering investments in two different technologies to develop wireless communication devices. The cash flows of the projects are given below. Hani Group wants to choose one of these two projects and its required rate of return is 10%.
Year G4 (CF in millions) Wi-Fi (CF in millions)
0 ($20) ($30)
1 . $20 $20
2. $50 $40
3. $40 $100
a.Based on the NPV, which project should Hani Group undertake?
b.Based on the IRR which project should Hani Group undertake?
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Contemporary Financial Management
Authors: R. Charles Moyer, James R. Mcguigan, William J. Kretlow
9th Edition
032416470X, 9780324164701
