A company is considering two potential projects. Each project requires a ($ 20,000) initial investment and is

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A company is considering two potential projects. Each project requires a \(\$ 20,000\) initial investment and is expected to generate annual net cash flows as follows. Assuming a discount rate of \(10 \%\), compute the net present value of each project. If only one project can be selected, which is chosen?

Year 1 2..... 3 ** Net Cash Flows Project A Project B $12,000 8,500 4,000 $ 4,500 8,500 13,000

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