Question: 1) Matrix.com is able to design only one of two virtual-reality programs that is indistinguishable from real life to those experiencing it. The projects are
1) Matrix.com is able to design only one of two virtual-reality programs that is indistinguishable from real life to those experiencing it. The projects are mutually exclusive. Matrix.coms weighted average cost of capital is 12% and the reinvestment rate is 9%. The projects have the following payoff schedules:
| year | project 1 | project 2 |
|---|---|---|
| 0 | -30 | -45 |
| 1 | 6 | 6 |
| 2 | 5 | 6 |
| 3 | 5 | 8 |
| 4 | 10 | 10 |
| 5 | 10 | 12 |
| 6 | 10 | 15 |
| 7 | 10 | 15 |
| 8 | 4 | 15 |
| 9 | 4 | 15 |
| 10 | 4 | 20 |
Show all your work. You may want to add some columns if you are going to calculate the individual PV for the cash flows.
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a) Find NPV.
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b) Find IRR.
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c) Find MIRR.
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d) Find Discounted Payback.
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