2. C-U Electronics is evaluating a few potential projects and has $1 million to be allocated....

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2. C-U Electronics is evaluating a few potential projects and has $1 million to be allocated. Which of the projects should the company accept to stay within the budget? How much does the budget constraint cost the company in terms of lost market value? The discount rate for each project is 11%. Project A B C D E F G Investment ($ thousands) 300 200 250 100 100 350 400 NPV ($ thousands) 80 -8 45 10 15 70 45 IRR (%) 17.2 10.7 16.6 11.8 12.1 18.0 13.5 2. C-U Electronics is evaluating a few potential projects and has $1 million to be allocated. Which of the projects should the company accept to stay within the budget? How much does the budget constraint cost the company in terms of lost market value? The discount rate for each project is 11%. Project A B C D E F G Investment ($ thousands) 300 200 250 100 100 350 400 NPV ($ thousands) 80 -8 45 10 15 70 45 IRR (%) 17.2 10.7 16.6 11.8 12.1 18.0 13.5

Answer rating: 100% (QA)

To decide which projects CU Electronics should accept while staying within the 1 million budget we need to consider the Net Present Value NPV of each ... View the full answer