Question: C3: Consider the project s described in the table below: ISK1:10 marks) Endof Yearl ProjectA Cash Flow(5)T-ProjectB Cash Flow (S) Project B Cash Flow (S)

 C3: Consider the project s described in the table below: ISK1:10

C3: Consider the project s described in the table below: ISK1:10 marks) Endof Yearl ProjectA Cash Flow(5)T-ProjectB Cash Flow (S) Project B Cash Flow (S) 0 2 4 6 $-90,000 17,000 17,000 17,000 17,000 17,000 17,000 17,000 17,000 17,000 17,000 $ 90,000 0 0 0 0 34,000 34,000 34,000 34,000 7 9 10 90,000 Both projects have an appropriate risk adjusted discount rate of 7 percent. Required: a. Calculate the NPV and IRR for both projects (5 marks) b. If projects A and B are independent, which will you undertake? (2.5 marks) If projects A and B are mutually exclusive, which will you undertake? (2.5 marks) c

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