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TABLE P12.24 Project A Project B End of Year Mean Variance Mean Variance 0 -$5,000 1,0002 $10,000 2,0002 4,000 1,0002 6,000 1,500- 4,000 1,500- 8,000
TABLE P12.24 Project A Project B End of Year Mean Variance Mean Variance 0 -$5,000 1,0002 $10,000 2,0002 4,000 1,0002 6,000 1,500- 4,000 1,500- 8,000 2,000212.24 Two mutually exclusive investment projects are under consideration. It is assumed that the cash flows are statistically independent random variables with means and variances estimated as given in Table P12.24. (a) For each project, determine the mean and stand- ard deviation of the NPW, using an interest rate of 15%. (b) On the basis of the results of part (a), which pro- ject would you recommend
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