A&B Enterprises is trying to select the best investment among the four alternatives. Each alternative involves an initial outlay of $100,000. Your cash flows are as follows:

investment a - year 1 = 10k, year 2 = 20k, year 3 = 30k, year 4 = 40k, year 5 = 50k investment b
- year 1 = 50k, year 2 = 40k, year 3 = 30k, year 4 = 0, year 5 = 0
investment c - years 1-5 = 25k each
investment d - year 1 = 0, year 2 = 0, year 3 = 45k, year 4 = 55k, year 5 = 60k



Evaluate and rank each alternative based on a) payback period, b) net present value (use a 10% discount rate), and c) internal rate of return.

Answer rating: 100% (QA)

To evaluate and rank each investment alternative based on the payback period net present value NPV and internal rate of return IRR we need to calculat... View the full answer