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[Problem deals with comparing NPV's of investment projects with unequal lives. The managers of Tinley Park Tin Plating, Inc. want to create a new type

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[Problem deals with comparing NPV's of investment projects with unequal lives. The managers of Tinley Park Tin Plating, Inc. want to create a new type of acrylic sheet. The firm anticipates strong demand over the next 16 years, and it can meet that demand with either of two methods (projects), supported by different types of manufacturing equipment. The two projects would be equally risky, such that the annual weighted average cost of capital (WACC) for either project would be 9,4%. Project A has a 16-year expected life and Net Present Value of $7,200,000. Project B has an 8-year expected life and NPV of $4,600,000. Because demand should continue throughout the next 16 years, the company managers would expect to repeat Project B once (over years 9 to 16) Bis chosen. It is assumed that the NPV for a repetition of Project B would also be $4,600,000 at the future date when it is repeated (efficiency gains should offset any inflationary effects - just as we assumed in the examples we worked). Based on the replacement chain method of analysis, what are the two relevant total NPV figures to compare? O A 57,200,000.00 for Project A and $9,200,000.00 for Project B B. 88,910,233.25 for Project A and $5,692,649.02 for Project B C. $7,200,000.00 for Project A and 56,841,915.58 for Project B D. 83,938,400.00 for Project A and $4,600,000.00 for Project B E. 58.910,233.25 for Project A and 56,841,915.58 for Project B

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