Question
magine that your company is facing with a set of capital budgeting investment opportunities. The data table below shows the net investment and the net
magine that your company is facing with a set of capital budgeting investment opportunities. The data table below shows the net investment and the net cash flows of the different but same scale capital budgeting projects:
Year | Project #1 | Project #2 |
0 | -$4,500 | -$22,000 |
1 | $5,700 | $25,800 |
Based on the financial data presented in the table above, which one of the projects looks like a better investment with NPV and PI decision rationale (use 10.00% as the minimum required rate of return)?
Group of answer choices
Neither one of the projects
Project #2
Both Project #1 and #2
Project #1
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