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Your firm has estimated the following cash flows for two mutually exclusive capital investment projects. The firm's required rate of return is 13%. Year Project
Your firm has estimated the following cash flows for two mutually exclusive capital investment projects. The firm's required rate of return is 13%.
Year | Project A Cash Flow | Project B Cash Flow |
0 | -$200,000 | -$200,000 |
1 | 60,000 | 88,000 |
2 | 60,000 | 88,000 |
3 | 60,000 | 88,000 |
4 | 60,000 |
|
5 | 60,000 |
|
Which of the following statements best describes projects A and B?
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