Question
Janina, Incorporated, has the following mutually exclusive projects. Year Project A Project B 0 $ 16,000 $ 19,000 1 10,000 11,000 2 6,500 7,500 3
| Janina, Incorporated, has the following mutually exclusive projects. |
| Year | Project A | Project B |
|---|---|---|
| 0 | $ 16,000 | $ 19,000 |
| 1 | 10,000 | 11,000 |
| 2 | 6,500 | 7,500 |
| 3 | 2,500 | 6,500 |
| a-1. | Calculate the payback period for each project. (Do not round intermediate calculations and round your answers to 3 decimal places, e.g., 32.161.) |
| a-2. | If the company's payback period is two years, which, if either, of these projects should be chosen? |
multiple choice 1
|
| b-1. | What is the NPV for each project if the appropriate discount rate is 16 percent? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) |
| b-2. | Which, if either, of these projects should be chosen if the appropriate discount rate is 16 percent? |
multiple choice 2
|
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