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Questions Navigation Menu Company is considering two mutually exclusive investments whose expected net cash flows are as follows: Expected Net Cash Flows Year Project
Questions Navigation Menu Company is considering two mutually exclusive investments whose expected net cash flows are as follows: Expected Net Cash Flows Year Project A Project B 0 -$400 -$650 1 -528 210 2 -219 210 3 -150 210 4 1,100 210 5 820 210 6 990 210 7 -325 210 a. Select the correct graph for NPV profiles for Projects A and B. A B C VPV(S) VPV(S) VPV(S) 1400 1400 1400 1200 1200 1200 1000 1000 1000 800 Project A 800 Project B 800 Project A 600 600 600 400 400 400 Project B Project A Project B 200 200 200 -200 -5 5 -200 Cost of capital(%) 10 .5 20 -5 -400 -400 5 10 Cost of capital (%) 5 .5 20 -5 5 10 15 20 25 30 -200 Cost of capital(%) -400 0
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