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what is the risk-adjusted NPV of project A? what is the risk-adjusted NPV of project B? (Risk-adjusted NPV) The Hokie Corporation is considering two mutually

image text in transcribedwhat is the risk-adjusted NPV of project A?

what is the risk-adjusted NPV of project B?

(Risk-adjusted NPV) The Hokie Corporation is considering two mutually exclusive projects. Both require an initial outlay of $12,000 and will operate for 7 years. Project A will produce expected cash flows of $6,000 per year for years 1 through 7, whereas project B will produce expected cash flows of $7,000 per year for years 1 through 7. Because project B is the riskier of the two projects, the management of Hokie Corporation has decided to apply a required rate of return of 15 percent to its evaluation but only a required rate of return 12 percent to project A. Determine each project's risk-adjusted net present value

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