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Semi-Goods Inc. requires a minimum rate of return of 13.5% on investment proposals. There are currently two proposals considered, but only one may be chosen.
Semi-Goods Inc. requires a minimum rate of return of 13.5% on investment proposals. There are currently two proposals considered, but only one may be chosen. The first investment alternative, Alternative A provides a net return of $3 500 per year for 10 years. The second Alternative, Alternative B provides a net return of $9 500 for years 3, 6 and 8. Determine the preferred alternative using the discounted cash flow criterion.
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