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please write or type clearly, Thx!!!:) Question 2 - Discounted Cash Flow Valuation (10 marks) Chandler Tire Co. is trying to decide which one of
please write or type clearly, Thx!!!:)
Question 2 - Discounted Cash Flow Valuation (10 marks) Chandler Tire Co. is trying to decide which one of two projects it should accept. Both projects have the same start-up costs. Project 1 will produce annual cash flows of $52,000 a year for 6 years. Project 2 will produce cash flows of $48,000 a year for 8 years. The company requires a 15 percent rate of return. 1) What is the present value of project 1's cash flow? (4 marks) 11) What is the present value of project 2's cash flow? (4 marks) iii) Which project should the company select and why? (2 marks)Step by Step Solution
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