Tiger Corporation has two projects (A and B) under consideration and the following table shows their...

 

Transcribed Image Text:

Tiger Corporation has two projects (A and B) under consideration and the following table shows their initial investment and their five years projected operating cash inflows. The firm has a cost of capital of 12%. Initial Investment Year 1 2 3 4 5 Required: 11. Project A $80,000 Project B $30,000 $25,000 $30,000 $25,000 $28,000 $80,000 Operating Cash Inflows $30,000 Compute the Net Present Value of projects A & B. 25.000 30,000 40,000 45,000 Advise which project should be selected with justification. (20 marks) (5 marks) Tiger Corporation has two projects (A and B) under consideration and the following table shows their initial investment and their five years projected operating cash inflows. The firm has a cost of capital of 12%. Initial Investment Year 1 2 3 4 5 Required: 11. Project A $80,000 Project B $30,000 $25,000 $30,000 $25,000 $28,000 $80,000 Operating Cash Inflows $30,000 Compute the Net Present Value of projects A & B. 25.000 30,000 40,000 45,000 Advise which project should be selected with justification. (20 marks) (5 marks)