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The Whenworth Corporation is trying to choose between the following two mutually exclusive design projects: Year O Cash Flow (1) Cash Flow (II) $84,000 -$29,800
The Whenworth Corporation is trying to choose between the following two mutually exclusive design projects: Year O Cash Flow (1) Cash Flow (II) $84,000 -$29,800 30,600 10,500 36,900 17,400 43,700 15,600 a-1. If the required return is 11 percent, what is the profitability index for each project? (Do not round intermediate calculations and round your answers to 3 decimal places, e.g., 32.161.) a-2. If the required return is 11 percent and the company applies the profitability index decision rule, which project should the firm accept? b-1. If the required return is 11 percent, what is the NPV for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) b-2. If the company applies the NPV decision rule, which project should it take? a-1. Project 1 Project 11 a-2. Project acceptance b-1. Project Project 11 b-2. Project acceptance
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