Question: A firm is considering two projects A and B with the given cash flows; the firm's cost of capital is 12%. The NPV and IRR

A firm is considering two projects A and B with the given cash flows; the firm's cost of capital is 12%. The NPV and IRR of Project A are as given in the table: t CFt(A) CFt(B) 0 ($20,000.00) ($25,000.00) 1 $8,000.00 $12,000.00 2 $8,000.00 $12,000.00 3 $8,000.00 $5.500.00 4 $5,000.00 $5,500.00 NPV $2,392.24 12 IRR 17.93% ? If the projects are independent, which would be financially recommendable? El Both Project A and Project B ($20,000.00) ($25,000.00) 1 $8,000.00 $12,000.00 2 $8,000.00 $12,000.00 3 $8,000.00 $5,500.00 4 $5,000.00 $5,500.00 NPV $2,392.24 IRR 17.93% ? If the projects are independent, which would be financially recommendable? Both, Project A and Project B Neither of the projects is recommendable Project B Project
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