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). The director of capital budgeting for a firm has identified two mutually exclusive projects, A and B, with the following expected net cash flows:
). The director of capital budgeting for a firm has identified two mutually exclusive projects, A and B, with the following expected net cash flows: Expected Net Cash Flows Year Project A Project B 0 ($100) ($100) 1 70 10 2 50 60 3 20 80 Both of the projects have a cost of capital of 14 percent. (i) What is the regular payback period (in years) for Project B? Regular (non-discounted) Payback Period for B = ____________________. (ii) What is Project A's net present value (NPV)? NPV for A = ____________________. (iii) What is the profitability index (PI) for Project B? Profitability Index for B = ____________________. (iv) What is the modified internal rate of return for Project A? MIRR for Project A = ____________________.
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