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The Butler-Parkins Company (BPC) must decide between two mutually exclusive projects. Each project has an initial outflow of $6,750 and has an expected life of

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The Butler-Parkins Company (BPC) must decide between two mutually exclusive projects. Each project has an initial outflow of $6,750 and has an expected life of 3 years. Annual project cash flows begin 1 year after the initial investment and are subject to the following probability distributions Project A Project Probability Cash Flows Probability Cash Flows 0.2 $6,250 0.2 s 0 0.6 5,750 0.6 5,750 0.2 7,250 0.2 18,000 BPC has decided to evaluate the riskler project at 13% and the lessonsky project at 9% a. What is each project's expected annual cash flow Round your answers to the nearest cent. Project A Project : $ Project standard deviation () is 55.795 and is coefficient of variation (CV) is 0.76. What are the values of com) and (CW) Do not round intermediate calculations, Round your answer for standard deviation to the nearest cent and for coefficient of variation to two decimal places OA $ CV D. Based on their risk-adjusted NPVs, which project should BPC choose? . If you knew that Project B's cash flows were negatively correlated with the firm's other cash flow, whereas Project A's fons were positively correlated, how might this affect the decision? Select It Project B's cash flows were negatively correlated with gross domestic product (GDP), while A's flows were positively correlated, would that influence your risk assessment? Projec A Probability Cash Flows 0.2 $6,250 0.6 6,750 0.2 7,250 Project D Probability Cash Flows 0.2 $ 0 0.6 6,750 0.2 18,000 BPC has decided to evaluate the riskier project at 13% and the less-risky project at 9%. a. What is each project's expected annual cash flow? Round your answers to the nearest cent. Project A: Project B: $ Project B's standard deviation (08) is $5,798 and its coefficient of variation (CVE) is 0.76. What are the values Round your answer for standard deviation to the nearest cent and for coefficient of variation to two decimal p! OA: $ CVA: b. Based on their risk-adjusted NPVs, which project should BPC choose? -Select- c. If you knew that Project B's cash flows were negatively correlated with the firm's other cash flow, whereas Pro affect the decision2 -Select- This would make Project B more appealing. This would make Project Bless appealing. prrelated with gross domestic product (GDP), while A's flows were assessment -Select- 2

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