Question: Consider two mutually exclusive new product launch projects that Nagano Golf is considering. Assume the discount rate for both products is 13 percent. Project A:

 Consider two mutually exclusive new product launch projects that Nagano Golfis considering. Assume the discount rate for both products is 13 percent.

Consider two mutually exclusive new product launch projects that Nagano Golf is considering. Assume the discount rate for both products is 13 percent. Project A: Nagano NP-30. Professional clubs that will take an initial investment of $570,000 at Year O. For each of the next 5 years, (Years 1-5), sales will generate a consistent cash flow of $205,000 per year. Introduction of new product at Year 6 will terminate further cash flows from this project. Project B: Nagano NX-20. High-end amateur clubs that will take an initial investment of $400,000 at Year 0. Cash flow at Year 1 is $120,000. In each subsequent year, cash flow will grow at 10 percent per year. Introduction of new product at Year 6 will terminate further cash flows from this project Year NP-30 NX-20 400,000 1 2 3 4 5 570,000 205,000 205,000 205,000 205,000 205,000 120,000 132,000 145,200 159,720 175,692 Complete the following table: (Do not round intermediate calculations. Round your "PI" answers to 3 decimal places, e.g., 32.161, and other answers to 2 decimal places, e.g., 32.16. Enter your IRR answers as a percent.) NP-30 NX-20 Payback years years IRR % % PI NPV

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