Given the following cash flows for project X and project Y, Year Project X Project Y 0 -55000 -100000 1 20000 15000 2 13500 17000 3 11000 19000 4 10000 25000 5 9000 30000 6 7500 35000 Calculate the NPV, IRR, MIRR and traditional payback period for each project, assuming a required rate of return of 7 percent
Given the following cash flows for project X and project Y, Year Project X Project Y 0 -55000 -100000 1 20000 15000 2 13500 17000 3 11000 19000 4 10000 25000 5 9000 30000 6 7500 35000 Calculate the NPV, IRR, MIRR and traditional payback period for each project, assuming a required rate of return of 7 percent
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
- Given the following cash flows for project X and project Y,
Year |
Project X |
Project Y |
0 |
-55000 |
-100000 |
1 |
20000 |
15000 |
2 |
13500 |
17000 |
3 |
11000 |
19000 |
4 |
10000 |
25000 |
5 |
9000 |
30000 |
6 |
7500 |
35000 |
- Calculate the
NPV ,IRR , MIRR and traditional payback period for each project, assuming a requiredrate of return of 7 percent - If the projects are independent, which project(s) should be selected? If they are mutually exclusive, which project should be selected?
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