Question: For the following please show work to get the answer. 14. You are the CFO for FINA Inc and are responsible for final decision-making on

For the following please show work to get the answer.

14. You are the CFO for FINA Inc and are responsible for final decision-making on capital budget spending for 2022. You have a total capital budget for the year of $17 million and have set a hurdle rate of 9%, based on your WACC. You have 10 possible projects that you could fund. Decide which of these you will fund in this year's capital budget.

1 = $4 million investment with IRR of 7%

2 = $12 million investment with IRR of 6%

3 = $4 million investment with IRR of 9%

4 = $6 million investment with IRR of 11%

5 = $8 million investment with IRR of 10%

6 = $5 million investment with IRR of 5%

7 = $3 million investment with IRR of 9.8%

8 = $3 million investment with IRR of 7%

9 = 10 million investment with IRR of 10%

10 = 1 million investment with IRR of 9%

15. You are considering two possible projects. Using the NPV method, compare each project and then decide which you will fund. Use a WACC of 5%. Be sure to show the NPV of each project.

Project A

This project involves constructing a new factory to build your new widget that looks like a promising opportunity. The new factory will cost $30 million initially but will earn an expected $3 million in profits annually for the next 20 years.At the end of the 20 years, you expect to be able to sell the factory for $5 million.

Project B

This project involves converting your current factory to make the new widgets. The conversion will only cost $10 million but you will only have the capacity to earn an expected profit of $1.8 million. You will not be able to sell the converted factory at the end of the 20 years, as it will still be needed for other manufacturing.

Which Project will you choose to fund?

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