Question: Consider two mutually exclusive projects that will be conducted for a total of 6 years. Project A lasts 3 years (so it will need to
Consider two mutually exclusive projects that will be conducted for a total of 6 years. Project A lasts 3 years (so it will need to be repeated 1 time) and has the following cash flow:
Year 0 -$20,000;
Year 1 $17,000;
Year 2 $19,000;
Year 3 $11,000.
Project B lasts 2 years (so it will need to be repeated 2 times) and has the following cash flow:
Year 0 -$29,000;
Year 1 $18,000;
Year 2 $25,000.
Assume both projects can be repeated with the identical cash flows. The interest rate is 14.4%. Provide the net present worth for 6 YEARS of the project that you should select. If neither project should be selected, enter 0."
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