and Study Tools Options Success Tips success Tips dback 7. Unequal project lives Luthering Corp. has to choose between two mutually exclusive projects. If chooses project A, Luthering Corp will have the opportunity to similar investment in three years. However, if it chooses project 8, it will not have the opportunity to make a second investment The ists the cash flows for these projects. If the firm uses the replacement chain (common in) appsach, what present value (NPV) of project A and project 8, assuming that both projects have a weighted average cost of capital of 11% be the difference between the net Cash Flow Project A Year 0-$15,000 Project Year 0 -$40,000 8,000 Year 1 9,000 Year 11 Year 2 15,000 Year 2 16,000 Year 3: 14,000 Year 3 15,000 Year 4 12,000 Year 5 11,000 Year 6: 10,000 $12,742 O$13,538 O $11,945 $17,520 O $15,927 thing Corp O O $15,927 Luthering Corp. is considering a four-year project that has a weighted average cost of capital of 12% replicate this project indefinitely. What is the equivalent annual annuity (EAA) for this project? $10,707 O $11,194 $9,734 O $12,168 O $10,221 MacBook Air $29,567. Luthering Corp. can Grade It Now Save & Continue Continue without saving Luthering Corp. has to choose between two mutually exclusive projects. If it chooses project A, Luthering Corp. will have the opportunity to make a similar investment in three years. However, if it chooses project B, it will not have the opportunity to make a second investment. The following table lists the cash flows for these projects. If the firm uses the replacement chain (common life) approach, what will be the difference between the net present value (NPV) of project A and project B, assuming that both projects have a weighted average cost of capital of 11%? Cash Flow Project A Project B Year 0: Year 0: -$15,000 -$40,000 Year 1: 9,000 Year 11 8,000 Year 2 15,000 Year 2: 16,000 Year 3: 14,000 Year 3: 15,000 Year 4: 12,000 Year 5: 11,000 Year 6 10,000 $12,742 $13,538 $11.945 O $17,520 @m $11,945 O $17,520 O $15,927 Luthering Corp, is considering a four-year project that has a weighted average cost of capital of 12% and a NPV of $29,567. Luthiring Corp. can replicate this project indefinitely. What is the equivalent annual annuity (EAA) for this project? $10,707 O $11,194 $9,734 O $12,168 $10,221 Grade It Now Save & Continue Continue without saving O