Suppose that the cash flows of two investments are as follows: Unit: $1000 YEAR: 0 I...

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Suppose that the cash flows of two investments are as follows: Unit: $1000 YEAR: 0 I CASH FLOW AT YEAR 1 3 5,500,000 3,300,000 4 Investment (12,000,000) 6,000,000 2,500,000 Investment (12,000,000) 3,000,000 4,000,000 5,000,000 5,500,000 5,000,000 5 2,000,000 Using the investment decision rules (L.e., NPV & IRR) to select the best investment. Suppose that the hurdle rate, r is 15%. Suppose that the cash flows of two investments are as follows: Unit: $1000 YEAR: 0 I CASH FLOW AT YEAR 1 3 5,500,000 3,300,000 4 Investment (12,000,000) 6,000,000 2,500,000 Investment (12,000,000) 3,000,000 4,000,000 5,000,000 5,500,000 5,000,000 5 2,000,000 Using the investment decision rules (L.e., NPV & IRR) to select the best investment. Suppose that the hurdle rate, r is 15%.

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Investment A NPV CF0 CF11 r1 CF21 r2 CF31r3 CF41r4 CF51r5 12000000 60000001 151 55000001 152 3300000... View the full answer