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You are asked to evaluate two projects A and B. The cost of capital is 7.5%. The expected cash flows are given as Year Project
You are asked to evaluate two projects A and B. The cost of capital is 7.5%. The expected cash flows are given as Year Project A Project B 0 ($50,000) ($50,000) 1 10,000 0 2 20,000 20,000 3 30,000 30,000 4 40,000 50,000 5 50,000 60,000 Answer the next following 6 questions: a. What is the NPV of Project A? b. What is the NPV of Project B? c. If Project A and B are mutually exclusive, which project should you accept? d. What is the IRR of Project A (input your answer in %, i.e., if your answer is 12.45%, input 12.45 in the answer box)? e. What is the IRR of Project B (input your answer n %) f. If the two projects are mutually exclusive, which project should you accept? Input your answers in the next 6 questions. Suggestion calculate all the answers first and then input the answers into the next 6 answer boxes. You are asked to evaluate two projects A and B. The cost of capital is 7.5%. The expected cash flows are given as Year Project A Project B 0 ($50,000) ($50,000) 1 10,000 0 2 20,000 20,000 3 30,000 30,000 4 40,000 50,000 5 50,000 60,000 Answer the next following 6 questions: a. What is the NPV of Project A? b. What is the NPV of Project B? c. If Project A and B are mutually exclusive, which project should you accept? d. What is the IRR of Project A (input your answer in %, i.e., if your answer is 12.45%, input 12.45 in the answer box)? e. What is the IRR of Project B (input your answer n %) f. If the two projects are mutually exclusive, which project should you accept? Input your answers in the next 6 questions. Suggestion calculate all the answers first and then input the answers into the next 6 answer boxes
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