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Need help with the excel formula shortcuts: 13. As the director of capital budgeting for Denver Corporation, you are evaluating two mutually exclusive projects with
Need help with the excel formula shortcuts:
13. As the director of capital budgeting for Denver Corporation, you are evaluating two mutually exclusive projects with the following net cash flows: | |||||||
Year | Project x | Project z | |||||
0 | -100,000 | -100,000 | |||||
1 | 50,000 | 10,000 | |||||
2 | 40,000 | 30,000 | |||||
3 | 30,000 | 40,000 | |||||
4 | 10,000 | 60,000 | |||||
If Denvers cost of capital is 15 percent, which project would you choose? |
14. The Seattle Corporation has been presented with an investment opportunity which will yield cash flows of $30,000 per year in Years 1 through 4, $35,000 per year in Years 5 through 9, and $40,000 in Year 10. This investment will cost the firm $150,000 today, and the firms cost of capital is 10 percent. What is the payback period for this investment?
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