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You are analyzing two mutually exclusive projects. The required rate of return is 1 4 . 6 percent per year for project A and 1

You are analyzing two mutually exclusive projects. The required rate of return is 14.6 percent per year for project A and 13.8 percent per year for project B. Which project should you accept and why? Here are the cash flows for both projects. Although both projects require an initial $50,000 investment in Year 0(now), the Year 1 through 3 cash inflows are different. For the project A, Year 1 through 3 cash inflows are $24,800, $36,200, and $21,000. For the project B, Year 1 through 3 cash inflows are $41,000, $20,000, and $10,000.

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