The Yoo Corporation is trying to choose between the following two mutually exclusivedesign projects:2pointsYearCash Flow (I)Cash Flow (II)0-$ 65,000-$ 17,900130,0009,650239,6509,650McGrawHill30,00030,000a-1. If the required return is 12 percent, what is the profitability index for both projects?Note: Do not round intermediate calculations and round your answers to 3 decimalplaces, e.g., 32.161.× Answer is complete but not entirely correct.Project IProject II1.331 x1.236 ×a-2. If the company applies the profitability index decision rule, which project shouldthe firm accept?Project IProject IIb-1. What is the NPV for both projects?Note: A negative answer should be indicated by a minus sign. Do not roundintermediate calculations and round your answers to 2 decimal places, e.g., 32.16.× Answer is complete but not entirely correct.Project I$15,357.13 xProject II$7,948.20 x< Prev1 of 1Next

Cash Flow (i)YearCashFlowPV Factor@…

Answered: The Yoo Corporation is trying to choose…

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter12: Capital Budgeting: Decision Criteria

Section: Chapter Questions

Problem 13P

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Hello, Could you help me double check my work. I attached the image.
The Webex Corporation is trying to choose between the following two mutually exclusive designprojects: Year Net Cash Flow Project - I($) Net Cash Flow Project - II($) 0 (53,000) (16,000) 1 27000 9100 2 27000 9100 3 27000 9100 (a) If the required return is 10% and the company applies the Profitability Index decision rule,which project should the firm accept?(b) If the company applies the Net Present Value decision rule, which project should it take?(c) Explain why your answers in (a) and (b) are different(d) Calculate the Internal Rate of Return of both projects.

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