Question: 4.2 Panhandle Corp, is considering three projects. Each project has an initial outlay of $5,790,000. Project A is expected to earn $3,000,000 in year one,

4.2

Panhandle Corp, is considering three projects. Each project has an initial outlay of $5,790,000. Project A is expected to earn $3,000,000 in year one, $2,000,000 in year two, $1,000,000 in year three, $500,000 in year four, and $250,000 in year five. Project B is expected to earn $1,475,000 per year for five years. Project C is expected to earn $8,750,000 in year five. The WACC is 8%. How would project A's cash flow in year five need to change to make A's NPV equal to B's NPV? Increase by $345,945 Increase by $625,000 Increase by $95,945 Increase by $425,365

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