Question
Please show computations in Excel formula. A firm with a 14% WACC is evaluating two projects for this years capital budget. After-tax cash flows, including
Please show computations in Excel formula.
A firm with a 14% WACC is evaluating two projects for this years capital budget. After-tax cash flows, including depreciation, are as follows:
| 0 | 1 | 2 | 3 | 4 | 5 | |
|---|---|---|---|---|---|---|
| Project A | -$50,000 | $10,000 | $15,000 | $17,500 | $21,000 | $15,000 |
| Project B | -$95,000 | $35,000 | $27,500 | $25,000 | $20,000 | $15,000 |
a. Calculate NPV, IRR, MIRR, and payback for each project.
b. Assuming the projects are independent, which one(s) would you recommend?
c. If the projects are mutually exclusive, which would you recommend?
d. Notice that the projects have the same cash flow timing pattern. Why is there a conflict between NPV and IRR?
Please show computations in Excel formula.
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An Evaluation Of The Benefits And Value Of Libraries
Authors: Nyström, Viveca , Sjögren, Linnéa
1st Edition
1843346869,1780632932
