First Union Bank Corporation is evaluating two capital investment proposals for a driveup ATM kiosk, each requiring

Question:

First Union Bank is evaluating two capital investment proposals for a driveup ATM kiosk, each requiring an investment of $300,000 and each with an eight-year life and expected total net cash flows of $480,000. Location 1 is expected to provide equal annual net cash flows of $60,000, and Location 2 is expected to have the following unequal annual net cash flows:
Year 1 $90,000
Year 2 80,000
Year 3 65,000
Year 4 65,000
Year 5 $45,000
Year 6 45,000
Year 7 45,000
Year 8 45,000

Determine the cash for both proposals.

Corporation
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Payback period method is a traditional method/ approach of capital budgeting. It is the simple and widely used quantitative method of Investment evaluation. Payback period is typically used to evaluate projects or investments before undergoing them,...