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Please Solve the following in details ! Acme Mfg. is considering two projects, A & B, with cash flows as shown below: period CFA CFB
Please Solve the following in details !
Acme Mfg. is considering two projects, A & B, with cash flows as shown below:
period CFA CFB
0 -80,000 -100,000
1 20,000 60,000
2 30,000 25,000
3 20,000 25,000
4 20,000 25,000
The opportunity cost of capital is 12%. Calculate the PBP, NPV, and PI for each project. And which project(s) should be accepted in each of the following situations: (1) The projects are mutually exclusive and there is no capital constraint. (2) The projects are independent and there is no capital constraint.
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