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Use the following data to answer Questions 9 and 13: A company is considering two mutually exclusive projects: Project A has a cost of $15000,
Use the following data to answer Questions 9 and 13: A company is considering two mutually exclusive projects: Project A has a cost of $15000, a 3-year life, and after-tax cash flows of $10,000, $8,000 and $6,000 respectively. Project B has a cost of $15000, a 5-year life, and after-tax cash flows of $10,000, $5,000, $4,000, $3,000 and $2,000 respectively. Both projects have a WACC of 9%. 9. The Equivalent Annual Annuity (EAA) for project A is: * A. $2,861.34 B. $2,961.34 O C. $2,061.34 D. $2,188.94 O E. None of the above 10. The Equivalent Annual Annuity (EAA) for project B is: * A. $1,258.87 B. $0 C. $2,961.34 D. $3,200 E. None of the above 11. The Payback period for project A is: * A. 1.625 years B. 1 year C. 0.625 year D. 2 years E. None of the above 12. The discounted payback period for project B is: * O A. 2 years O B. 2.52 years C. 1.86 years D. 1.85 years O E. None of the above 13. The MIRR for project B is: * A. 14.33% B. 15.24% O C. 15.33% D. 15.00% E. None of the above
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