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Having received a grant of from World Bank, University of Kisubi is contemplating two different projects and decides to perform a financial analysis to determine

Having received a grant of from World Bank, University of Kisubi is contemplating two different projects and decides to perform a financial analysis to determine which is more financially lucrative. Project A and B have the cash flows as shown. University of Kisubi uses a required rate of return of 10% and an inflation rate of 4%.

  1. Compute the payback in years and the net present value for both projects and offer advice as to the best course of action. (15Marks)

Year

A

B

0

-$250,000

-$400,000

1

$75,000

$125,000

2

$155,000

$230,000

3

$200,000

$288,000

4

$175,000

$265,000

5

$160,000

$225,000

4b) Describe the purpose of a work breakdown structure while assessing the work to be accomplished in a project. (10 Marks)

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