Question
The Xavier Motor Company makes outdoor would like to consider tractor and snowblower as a demand for more powerful equipment in the company and
The Xavier Motor Company makes outdoor would like to consider tractor and snowblower as a demand for more powerful equipment in the company and due to some competitors are already moving in that direction. Management wants to make a decision based on only five years of projected cash flow because it feels the future beyond that is too vague to form a basis for current decisions. A financial analysis has put together a set of projected incremental cash flows for each project with a cost of capital 9% Year Tractor (cash flow) Snowblower (cash flow) Co (3000) (3,500) C1 (250) (700) C2 500 800 C3 1,000 1,200 C4 1,500 2,000 C5 1,500 2,000
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