Basic scenario analysis Prime Paints is in the process of evaluating two mutually exclusive additions to its
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Basic scenario analysis Prime Paints is in the process of evaluating two mutually exclusive additions to its processing capacity. The firm's financial analysts have developed pessimistic, most likely, and optimistic estimates of the annual cash inflows associated with each project. These estimates are shown in the following table. Project A $ Project B $ Initial investment CF Outcome Pessimistic Most likely Optimistic Annual cash inflows CF $ $ a Determine the range of annual cash inflows for each of the two projects b Assume that the firm's cost of capital is and that both projects have year lives. Construct a table a The range of annual cash inflows for project A is Box Round to the nearest dollar
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