Question
Star Computer Services has the following three investment projects available this year. The firm's cost of capital is 7 %. Project X Y Z Initial
Star Computer Services has the following three investment projects available this year.
The firm's cost of capital is 7 %.
| Project | X | Y | Z |
| Initial cost | $20,000 | $30,000 | $30,000 |
| Year 1 CF | 10,000 | 15,000 | 12,000 |
| Year 2 CF | 11,000 | 14,000 | 13,000 |
| Year 3 CF | 12,000 | 13,000 | 14,000 |
| Year 4 CF | 13,000 | 12,000 | 15,000 |
| a. | Which projects are acceptable? Why? |
| b. | What is your decision if the projects are mutually exclusive? |
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An Introduction To Trading In The Financial Markets Market Basics
Authors: R. Tee Williams
1st Edition
0123748380, 9780123748386
