Question: Jamison is considering two mutually exclusive projects with the following cash flows and the cost of capital of 10%. Year XX YY 0 -$1,000 -$1,200

Jamison is considering two mutually exclusive projects with the following cash flows and the cost of capital of 10%.

Year XX YY

0 -$1,000 -$1,200 1 $800 $700 2 $800 $700 3 $700

a) Based on Annualized NPV, which project would you choose? Why ANPV is better than NPV in this case.?

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