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Moses Manufacturing is attempting to select the best of three mutually exclusive projects, X, Y and Z. Though all the projects have five-year lives, they
Moses Manufacturing is attempting to select the best of three mutually exclusive projects, X, Y and Z. Though all the projects have five-year lives, they possess differing degrees of risk. Project X is in Class V, the highest risk class; project Y is in Class II, the below-average-risk-class; and project Z is in Class III, the average-risk-class. The basic cash flow data for each project and the risk classes and RADRs used by the firm are shown in the following tables. Project X Project Y Project Z | $235,0001. S310.000 Initial Inv.| Year (t) $180,000 Net cash inflows (CF) $80,000 70,000 S50,000$90,000 60,000 90,000 3 60.00070,00090.000
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