Question
Procter & Gamble is considering investing in three new projects: Project X, Project Y, and Project Z. The initial investment, annual cash flows, and project
- Procter & Gamble is considering investing in three new projects: Project X, Project Y, and Project Z. The initial investment, annual cash flows, and project lifespans are as follows:
Project | Initial Investment | Annual Cash Flows (Years 1-5) | Project Lifespan |
X | $2,000,000 | $500,000 | 5 years |
Y | $3,000,000 | $800,000 | 7 years |
Z | $1,500,000 | $400,000 | 4 years |
Calculate the net present value (NPV) and internal rate of return (IRR) for each project assuming a discount rate of 12%.
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Advanced Accounting
Authors: Floyd A. Beams, Joseph H. Anthony, Bruce Bettinghaus, Kenneth Smith
12th edition
133451860, 978-0133451863
