The firm is evaluating two proposed capital investments, Project X and Project Y. Each project has an initial capital expenditure of €12,000, and the cost of capital is 12%. The projects’ expected net cash flows are as follows:

	Expected net cash flows, EUR
year	project X	Project Y
0	-12,000	-12,000
1	6,500	4,500
2	4,000	4,500
3	4,000	4,500
4	2,000	4,500

Using the NPV CRITERION, determine which project(s) should be accepted if they are mutually exclusive?

Answer rating: 100% (QA)

To determine which project to accept using the Net Present Value NPV criterion we need to calculate ... View the full answer