Please show all work and/or formulas.

B G H 1 CHAPTER 14: CAPITAL BUDGETING 2 Homework 4.7, Chapter 14 3 4 5 6 7 Assume that you are the COO at Cactus Valley Medical Center. The CEO has asked you to analyze two proposed capital investments-Project X and Project Y. Each project requires a net investment outlay of $35,000, and the cost of capital for each project is 7 percent. The expected net cash flows for each project are as follow: 3 LO Year Project X Project Y 11 1 8,000 18,000 12 2 8,000 12,500 13 3 8,000 8,000 14 4 8,000 5,000 15 5 8,000 4,000 16 17 a. Calculate each project's payback period, net present value (NPV), and internal rate of return (IRR). 18 19 20 21 22 23 24 25 26 27 28 29 30 31 2 3 b. Which project(s) is/are financially acceptable? Explain your answer. 4 35 36 37