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Problem 9 - 1 7 Comparing Investment Criterla ( LO 1 , 2 , 3 , 5 , 7 ) Consider the following two mutuslly
Problem Comparing Investment Criterla LO
Consider the following two mutuslly exclusive projects:
Whichever project you choose, if any, you require o return on your investment.
a What is the poybock period for each project? Round the final answers to decimal places.
a If you opply the poybock criterion, which investment will you choose?
Project A
Project B
b What is the discounted poybock period for each project? Do not round Intermedlate calculations. Round the final answers to
decimal places.
b If you opply the discounted poybock criterion, which investment will you choose?
Project A
Project B
c What is the NPV for each project? Do not round intermedlate calculations. Round the final answers to decimal places. Omit $
sign In your response.
c If you apply the NPV criterion, which investment will you choose?
Project A
Project B
d What is the IRR for each project? Round the final answers to decimal places.
d If you spply the IRR criterion, which investment will you choose?e What is the profitability index for each project? Do not round intermediate
calculation. Round the final answers to decimal places.
e If you apply the profitability index criterion, which investment will you choose?
Project A
Project B
f Based on your answers in a through e which project will you finally choose?
Project A
Project B
Project A
Project BProblem Comparing Investment Criteria LO
Consider the following two mutuslly exclusive projects:
Whichever project you choose, if any, you require o return on your investment.
a Whot is the poybock period for each project? Round the final answers to decimal places.
a If you opply the poybock criterion, which investment will you choose?
Project A
Project B
b What is the discounted poybock period for each project? Do not round Intermedlate calculations. Round the final answers to
decimal places.
b If you opply the discounted poybock criterion, which investment will you choose?
Project A
Project B
c What is the NPV for each project? Do not round intermedlate calculations. Round the final answers to decimal places. Omlt $
sign In your response.
c If you apply the NPV criterion, which investment will you choose?
Project A
Project B
d What is the IRR for each project? Round the final answers to decimal places.
d If you spply the IRR criterion, which investment will you choose?
Project A
Project Be What is the profitability index for each project? Do not round intermediate
calculation. Round the final answers to decimal places.
project
project
e If you apply the profitability index criterion, which investment will you choose?
Project A
Project B
f Based on your answers in a through e which project will you finally choose?
Project A
Project B
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