Beximco is considering two mutually exclusive projects, one with an initial investment of $115000 and another one with $125000 The companys board of directors has set a maximum 3 5 years payback requirement The cash inflows associated with the two projects are shown below Year Project A Project B 2021 30000 55000 2022 30000 10000 2023 30000 35000 2024 30000 40000 2025 30000 11000 Required Calculate the Payback Period for each project Which project should be selected according to the payback period method Calculate the NPV of each project if the required rate of return is 8 Which project should be selected according to the NPV method Which projects should be selected if the projects are independent

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Question: Beximco is considering two mutually exclusive projects, one with an initial investment of $115000 and another one with $125000. The companys board of directors has

Beximco is considering two mutually exclusive projects, one with an initial investment of $115000 and another one with $125000. The companys board of directors has set a maximum 3.5 years payback requirement. The cash inflows associated with the two projects are shown below:

Year	Project A	Project B
2021	30000	55000
2022	30000	10000
2023	30000	35000
2024	30000	40000
2025	30000	11000

Required:

Calculate the Payback Period for each project.
Which project should be selected according to the payback period method?
Calculate the NPV of each project if the required rate of return is 8%.
Which project should be selected according to the NPV method?
Which projects should be selected if the projects are independent?

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