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Your firm is subject to capital rationing and can only invest $60,000. You've estimated the following cash flows (in $) for two projects: Year Project

Your firm is subject to capital rationing and can only invest $60,000. You've estimated the following cash flows (in $) for two projects:

Year Project A Project B
0 -54,000 -54,000
1 10,000 30,000
2 20,000 20,000
3 30,000 10,000
4 40,000 0

The required return for both projects is 8%.

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Intro Your firm is subject to capital rationing and can only invest $60,000. You've estimated the following cash flows (in $) for two projects: Year Project A Project B 0 -54,000 -54,000 1 10,000 30,000 2 20,000 20,000 3 30,000 10,000 4 40,000 0 The required return for both projects is 8%. Attempt 1/6 for 10 pts. Part 1 What is the payback period for project A? 2+ decimals Submit B Attempt 1/6 for 10 pts. Part 2 What is the payback period for project B? 2+ decimals Submit Part 3 | Attempt 1/5 for 10 pts. Which project seems better according to the payback method? Project B Project A Submit Attempt 1/6 for 10 pts. Part 4 What is the NPV for project A? 0+ decimals Submit Attempt 1/6 for 10 pts. Part 5 What is the NPV for project B? 0+ decimals Submit Part 6 6 | Attempt 1/5 for 10 pts. Which project seems better according to the NPV method? Project B Project A Submit Part 7 IB Attempt 1/5 for 10 pts. Compare the answers to parts 3 and 6. If both projects are mutually exclusive, which one should you accept? Project B Project A Submit

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