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Suppose your firm is considering two mutually exclusive, required projects with the cash flows shown below. The required rate of return on projects of both
Suppose your firm is considering two mutually exclusive, required projects with the cash flows shown below. The required rate of return on projects of both of their risk class is 12 percent, and that the maximum allowable payback and discounted payback statistic for the projects are 2 and 3 years, respectively. 0 1 2 3 Time: Project A Cash Flow Project B Cash Flow -39,000 29,000 49,000 20,000 -49,000 29,000 39,000 69,000 Use the Pl decision rule to evaluate these projects; accept the project with the higher Pl value. Multiple Choice reject A, accept B O accept A, reject B accept both A and B C ) accept neither A nor B
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