Question: 4. +(25 points) Consider the following two mutually exclusive projects: n 0 1 2 3 4 5 6 Project A -$10,000 Project B -$12,000

4. +(25 points) Consider the following two mutually exclusive projects: n 0

4. +(25 points) Consider the following two mutually exclusive projects: n 0 1 2 3 4 5 6 Project A -$10,000 Project B -$12,000 $3000 $1000 $3000 $1000 $3000 * 1.1 $1000+X $3000 *1.1 *1.1 $1000+2X $3000 *1.1 *1.1 *1.1 $1000+3X $3000 *1.1 *1.1 $1000+4X *1.1*1.1 The life cycle of project A and B is the same as 6 years. What value of X would make the decision maker indifferent between A and B at an interest rate of 6%?

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