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Use the following data to answer Questions 15 through 18: Wilson Co. is considering two mutually exclusive projects. Both projects require an initial investment of
Use the following data to answer Questions 15 through 18: Wilson Co. is considering two mutually exclusive projects. Both projects require an initial investment of $10,000 at t = 0. Project X has an expected life of 2 years with after-tax cash inflows of $6,000 and $8,500 at the end of Years 1 and 2, respectively. Project Y has an expected life of 4 years with after-tax cash inflows of $4,600 at the end of each of the next 4 years. Each project has a WACC of 11%. 17. The equivalent annual annuity (EAA) for project X is closest to: O A. $1,345.50 O B. $1,300.50 O C. $1,350 O D. $1,245.50 O E. None of the above
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