Suppose a company has two mutually exclusive projects, both of which are three years in length. Project A has an initial outlay of S6.000 and has expected cash flows of $2.000 in year 1. $4.000 in year 2, and $4.000 in year 3. Project B has an initial outlay of $7,000 and has expected cash fiows of $2.000 in year 1. $3.000 in year 2. and $6.000 in year 3. The required rate of return is 11% for projects at this company. What is the net present value for the best project? (Answer to the nearest dollar.)

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QUESTION 14
Suppose a company has two mutually exclusive projects, both of which are three years in length. Project A has an initial outlay of $6.000 and has
expected cash flows of $2,000 in year 1, $4.000 in year 2, and $4,000 in year 3. Project B has an initial outlay of $7,000 and has expected cash flows
of $2.000 in year 1. $3,000 in year 2. and $6.000 in year 3. The required rate of return is 11% for projects at this company. What is the net present
value for the best project? (Answer to the nearest dollar.)
QUESTION 15
if a project has an initial outlay of $35.000 and cash flows of $14,000 per year for the next 5 years, what is the IRR of this project? (Answer to the
nearest tenth of a percent, eg. 12.3).
Transcribed Image Text:QUESTION 14 Suppose a company has two mutually exclusive projects, both of which are three years in length. Project A has an initial outlay of $6.000 and has expected cash flows of $2,000 in year 1, $4.000 in year 2, and $4,000 in year 3. Project B has an initial outlay of $7,000 and has expected cash flows of $2.000 in year 1. $3,000 in year 2. and $6.000 in year 3. The required rate of return is 11% for projects at this company. What is the net present value for the best project? (Answer to the nearest dollar.) QUESTION 15 if a project has an initial outlay of $35.000 and cash flows of $14,000 per year for the next 5 years, what is the IRR of this project? (Answer to the nearest tenth of a percent, eg. 12.3).
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