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QUESTION 13 Two mutually exclusive projects being considered by a firm and have the following projected cash flows: Project A Project B Year Cash Flow
QUESTION 13 Two mutually exclusive projects being considered by a firm and have the following projected cash flows: Project A Project B Year Cash Flow Cash Flow 0 ($150,000) ($150,000) 1 50,000 30,000 50,000 30,000 3 50,000 30,000 30,000 5 30,000 6 30,000 2 4 The cost of capital is 10 percent. Using the NPV rule, evaluate both projects using the replacement approach Accept Project A Accept Project B Accept both Accept neither
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