Consider the following cashflow of the two mutually exclusive projects. Assume that the discount rate for both projects is 10%. Year Project A Project B O -$380,000 -$625,000 1 292,000 396,000 2 165,000 319,000 3 107,000 204,000 1) Please fill in the following table Project A Project B NPV IRR 2) Based on the NPV, which project should be chosen?
Consider the following cashflow of the two mutually exclusive projects. Assume that the discount rate for both projects is 10%. Year Project A Project B O -$380,000 -$625,000 1 292,000 396,000 2 165,000 319,000 3 107,000 204,000 1) Please fill in the following table Project A Project B NPV IRR 2) Based on the NPV, which project should be chosen?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Transcribed Image Text:Consider the following cashflow of the two mutually
exclusive projects. Assume that the discount rate for
both projects is 10%.
Year Project A Project B
O -$380,000 -$625,000
1 292,000 396,000
2 165,000 319,000
3 107,000 204,000
1) Please fill in the following table
Project A
Project B
NPV
IRR
2) Based on the NPV, which project should be chosen?
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