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Initial Year Year 1 Year 2 Year 3 Year 4 Investment A (400,000.00) 126,000.00 126,000.00 126,000.00 126,000.00 Investment B (160,000.00) 52,800.00 52,800.00 52,800.00 52,800.00 Required

Initial Year Year 1 Year 2 Year 3 Year 4
Investment A (400,000.00) 126,000.00 126,000.00 126,000.00 126,000.00
Investment B (160,000.00) 52,800.00 52,800.00 52,800.00 52,800.00
Required Return 8%
Investment A
NPV $17,327.98
IRR 10%
Investment B
NPV $14,880.30
IRR 12%
  • Analyze the results of the net present value calculations and the significance of these results, supported with examples.
  • Determine which project should be adopted based on the net present value approach and provide rationale for your decision.
  • Analyze the results of the internal rate of return calculation and the significance of these results, supported with examples.
  • Determine which project should be adopted based on the internal rate of return approach and provide rationale for your decision.
  • Determine the preferred method in the given circumstances and provide reasoning and details to support the method selected.
  • Synthesize results of analyses and computations to determine the best investment opportunity to recommend to the president of Donovan Enterprises.

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