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Intro Your firm is subject to capital rationing and can only invest $60,000. You've estimated the following cash flows (in $) for two projects: 1

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Intro Your firm is subject to capital rationing and can only invest $60,000. You've estimated the following cash flows (in $) for two projects: 1 Year Project A Project B 0 -56,000 -56,000 10,000 30,000 2 20,000 20,000 3 30,000 10,000 4 40,000 0 The required return for both projects is 8%. IB Attempt 1/6 for 10 pts. Part 1 What is the payback period for project A? 2+ decimals Submit Part 2 What is the payback period for project B? IB Attempt 1/6 for 10 pts. 2+ decimals Submit Part 3 Attempt 1/2 for 10 pts Which project seems better according to the payback method? O Project B Project A Submit IB Attempt 1/6 for 10 pts. Part 4 What is the NPV for project A? 0+ decimals Submit Part 5 What is the NPV for project B? IB Attempt 1/6 for 10 pts. 0+ decimals Submit Part 6 | Attempt 1/2 for 10 pts Which project seems better according to the NPV method? O Project B Project A Submit Part 7 IS Attempt 1/2 for 10 pts. Compare the answers to parts 3 and 6. If both projects are mutually exclusive, which one should you accept? O Project A O Project B Submit

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