Question
Two mutually exclusive projects have the following positive NPVs and project lives. Project NPV Life Project A $ 5,000 3 Years Project B $ 6,500
Two mutually exclusive projects have the following positive NPVs and project lives.
| Project | NPV | Life | ||
| Project A | $ | 5,000 | 3 | Years |
| Project B | $ | 6,500 | 5 | Years |
If the cost of capital were 15 percent, which project would you accept?
Please show all work.
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Contemporary Financial Management
Authors: James R Mcguigan, R Charles Moyer, William J Kretlow
10th Edition
978-0324289114, 0324289111
