Question: Cooper Electronics uses NPV profiles to visually evaluate competing projects. Key data for the two projects under consideration are given in the following table: Terra
Cooper Electronics uses NPV profiles to visually evaluate competing projects. Key data for the two projects under consideration are given in the following table:
Terra Firma
Initial investment $26,000 $23,000
Year Operating cash inflows
1 $12,000 $8,000
2 $9,000 $9,000
3 $7,000 $8,000
4 $10,000 $6,000
Using these data, graph, on the same set of axes, the NPV profiles for each project using discount rates of 0%, 8%, and the IRR.
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