Galaxy Satellite Co. is attempting to select the best group of independent projects competing for the...

 

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Galaxy Satellite Co. is attempting to select the best group of independent projects competing for the firm's fixed capital budget of $10,000,000. Any unused portion of this budget will earn less than its 20 percent cost of capital. A summary of key data about the proposed projects follows. Project A B с Initial Investment $3,000,000 9,000,000 1,000,000 7,000,000 Table 10.5 IRR 22) Which projects should the firm implement? (See Table 10.5) Answer 21% 25 24 23 PV of Inflows at 20% $3,050,000 9,320,000 1,060,000 7,350,000 20) Use the NPV approach to select the best group of two projects. What is the combined NPV of this group? (See Table 10.5) Answer 21) Use the IRR approach to select the best group of two projects. What is the combined NPV of this group? (See Table 10.5) Answer Galaxy Satellite Co. is attempting to select the best group of independent projects competing for the firm's fixed capital budget of $10,000,000. Any unused portion of this budget will earn less than its 20 percent cost of capital. A summary of key data about the proposed projects follows. Project A B с Initial Investment $3,000,000 9,000,000 1,000,000 7,000,000 Table 10.5 IRR 22) Which projects should the firm implement? (See Table 10.5) Answer 21% 25 24 23 PV of Inflows at 20% $3,050,000 9,320,000 1,060,000 7,350,000 20) Use the NPV approach to select the best group of two projects. What is the combined NPV of this group? (See Table 10.5) Answer 21) Use the IRR approach to select the best group of two projects. What is the combined NPV of this group? (See Table 10.5) Answer

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Based on summery of key data Into table 105 20 Using NPV Approach Best Group of Two pro... View the full answer