Find out the NPV, IRR and Payback period for each of the following three projects.

Assume I=5%.

Which of the above projects would you invest in? Assume that you may invest in as many projects as you want.

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Project A B с E CF0 -12000 -12000 -12000 -12000 -12000 CF1 3000 4000 3000 2000 1000 CF2 3000 4000 3000 2000 2000 CF3 4000 3000 3000 2000 3000 CF4 4000 3000 3000 6000 3000 CF5 1000 1000 1000 6000 6000 Project A B с E CF0 -12000 -12000 -12000 -12000 -12000 CF1 3000 4000 3000 2000 1000 CF2 3000 4000 3000 2000 2000 CF3 4000 3000 3000 2000 3000 CF4 4000 3000 3000 6000 3000 CF5 1000 1000 1000 6000 6000

Answer rating: 100% (QA)

NPV Present Value of Cash Inflows Present Value of cash Outflows Project A 3000 1105 1 3000 1105 2 4000 1105 3 4000 1105 4 1000 1105 5 12000 1310792 12000 110792 Project B 4000 1105 1 4000 1105 2 3000 ... View the full answer