Azusa Unlimited, Inc. has gathered projected cash flows for two projects. Which project is a better...

Transcribed Image Text:

Azusa Unlimited, Inc. has gathered projected cash flows for two projects. Which project is a better option for investment if the required return is 19 percent? Why do you think so? Please draw a conclusion by using both NPV and IRR for investment criteria. (We assume the discount rate (R) for NPV is 12%). Year 0 Cash Flow (A) -$105,000 Cash Flow (B) -$105,000 1234 42,200 52,600 34,600 39,400 38,700 35,500 40,500 30,100 Azusa Unlimited, Inc. has gathered projected cash flows for two projects. Which project is a better option for investment if the required return is 19 percent? Why do you think so? Please draw a conclusion by using both NPV and IRR for investment criteria. (We assume the discount rate (R) for NPV is 12%). Year 0 Cash Flow (A) -$105,000 Cash Flow (B) -$105,000 1234 42,200 52,600 34,600 39,400 38,700 35,500 40,500 30,100