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Project A and B are mutually exclusive. Project A has a four life and the project cash flows are -$200, $50, $75, $100, and $100
Project A and B are mutually exclusive. Project A has a four life and the project cash flows are -$200, $50, $75, $100, and $100 in years 0, 1, 2, 3, and 4 respectively. Project B has a two year life and the project cash flows are -$175, $100, and $140 in years 0, 1 and 2 respectively. The cost of capital for both projects is 10%. Project A has an NPV of $50.87. What is the NPV of replacement chain for project B?
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