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Please assist me with this question Question 6 Goga is evaluating three projects to maximize its shareholder's value. The three projects A, B, and C
Please assist me with this question
Question 6 Goga is evaluating three projects to maximize its shareholder's value. The three projects A, B, and C are equally risky. The company's required cost of capital for evaluating each of the projects is 11 percent. The initial outlay and annual cash flows over the life of each project are shown in the table below. 20 Marks Project A Project B Project C Initial Outlay (CFO) Year (t) (50,00000) 35,000.00 60,000.00 Cash Inflows (CFt) 8,000.00 8,000.00 8,000.00 8.000.00 8,000.00 8,000.00 18,000.00 18,000.00 18,000.00 18,000.00 18,000.00 2 12,000.00 15,000.00 22,000.00 5 6 Required 6.1. Calculate the NPV for each project over its life. Rank the projects in descending order 6.2. Use equivalent annuity (EAC) approach to evaluate and rank the projects in 6.3. Use replacement chain method to evaluate and rank the projects in descending order 6.4. Compare and contrast your findings in parts (6.1), (6.2)and (6.3). Which project would based on NPV descending order based on the EAC. you recommend that the company implement? WhyStep by Step Solution
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