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Here are the cash-flow forecasts for two mutually exclusive projects: Cash Flows (dollars) Year Project A Project B 0 113 113 1 43 62 2
| Here are the cash-flow forecasts for two mutually exclusive projects: |
| Cash Flows (dollars) | ||
| Year | Project A | Project B |
| 0 | 113 | 113 |
| 1 | 43 | 62 |
| 2 | 63 | 62 |
| 3 | 83 | 62 |
|
| ||
| a-1. | What is the NPV of each project if the opportunity cost of capital is 2%? (Do not round intermediate calculations. Round your answers to 2 decimal places.) |
| Project | NPV |
| A | $ |
| B | |
|
| |
| a-2. | Which project would you choose? | ||||
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| b-1. | What is the NPV of each project if the opportunity cost of capital is 12%? (Do not round intermediate calculations. Round your answers to 2 decimal places.) |
| Project | NPV |
| A | $ |
| B | |
|
| |
| b-2. | Which would you choose? | ||||
|
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