Question: Maxwell Software, Inc., has the following mutually exclusive projects Year Project A Project B 0 -$23,000 -$26,000 1 13,500 14,500 2 10,000 11,000 3 3,200

Maxwell Software, Inc., has the following mutually exclusive projects

Year Project A Project B

0 -$23,000 -$26,000

1 13,500 14,500

2 10,000 11,000

3 3,200 10,000

a-1. Calculate the payback period for each project.

Payback period

Project A years

Project B years

a-2. Which, if either, of these projects should be chosen? 1. Project A 2. Project B 3. Both Projects 4. Neither project

b-1. What is the NPV for each project if the appropriate discount rate is 17 percent?

NPV

Project A $

Project B $

b-2. Which, if either, of these projects should be chosen if the appropriate discount rate is 17 percent? 1. Project A 2. Project B 3. Both projects 4. Neither project

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