Question
UVW Logistics is considering two new ventures. The expected cash flows are shown below. The cost of capital is 7%. Year Project E Project F
UVW Logistics is considering two new ventures. The expected cash flows are shown below. The cost of capital is 7%.
Year | Project E | Project F |
0 | -$80,000 | -$90,000 |
1 | $25,000 | $30,000 |
2 | $30,000 | $35,000 |
3 | $20,000 | $25,000 |
4 | $10,000 | $15,000 |
a. Calculate the IRR for each project. b. Determine the NPV and suggest which project should be pursued.
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Financial Accounting
Authors: David Spiceland, Wayne Thomas, Don Herrmann
4th edition
1259307956, 978-1259307959
