Homework Answers
Answer:
We know that net present value=present value of future cash inflow-initial cash outflow
Thus,
Thus we can see that NPV of project A is
Higher than project B, as such project A shall be chosen.
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be accepted based on NPV. Round both NPVs to the nearest
dollar.
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1. Calculate the net present
value (NPV) for both projects, and determine which project should
be accepted based on NPV. Round both NPVs to the nearest
dollar.
2. Calculate the internal rate of return (IRR) for both
projects, and determine which project should be accepted based on
IRR.
3. Calculate the net present value (NPV) for both projects using
the crossover rate as your discount rate. Round both NPVs to the
nearest dollar.
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Use...
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