Question
You are analyzing proposed projects and have compiled the following information: WACC (Required Return): 10.00% Year 0 1 2 3 Project A CFs -$4,500,000 $1,000,000
You are analyzing proposed projects and have compiled the following information:
WACC (Required Return): 10.00%
| Year | 0 | 1 | 2 | 3 |
| Project A CFs | -$4,500,000 | $1,000,000 | $2,000,000 | $3,000,000 |
| Project B CFs | -$4,500,000 | $2,000,000 | $2,000,000 | $2,000,000 |
Compute the net present values of the proposed projects? Do you think the company would accept one or both projects based on the NPV criterion?
| Accept Project A only | ||
| Accept Project B only | ||
| Accept both Project A and Project B | ||
| Reject both Project A and Project B |
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Investing All In One
Authors: Eric Tyson
1st Edition
1119376629, 978-1119376620
