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Two projects under consideration have the following projected cash flows: Year Project P Project Q 0 -$80,000 -$80,000 1 $25,000 $0 2 $25,000 $0 3
Two projects under consideration have the following projected cash flows:
Year | Project P | Project Q |
0 | -$80,000 | -$80,000 |
1 | $25,000 | $0 |
2 | $25,000 | $0 |
3 | $25,000 | $0 |
4 | $25,000 | $0 |
5 | $25,000 | $120,000 |
Requirements:
- Compute the NPV at a discount rate of 10%.
- Calculate the IRR for both projects.
- Calculate the Discounted Payback Period for each project.
- Determine the crossover rate of the two projects.
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