Question: Module 6 Homework indicates when a projects investment will be recovered. There is no necessary relacons between a given payback and investor wealth maximization, A

Module 6 Homework indicates when a projects investment will be recovered. There is no necessary relacons between a given payback and investor wealth maximization, A variant of the regular payback is the discounted payback. Unlike regular payback, the discounted payback considers project costs. However, the discounted payback still disregards cash flows during the payback year. In addition, there is no specific payback rule to justify project acceptance. Both methods provide information about profitability and risk Quantitative Problem: Bellinger Industries is considering two projects for inclusion in its capital budget, and you have been asked to do the analysis. Both projects' after-tax cash flows are shown on the time line below. Depreciation, salvage values, net operating working capital requirements, and tax effects are all included in these cash flows. Both projects have 4-year lives, and they have risk characteristics similar to the firm's average project. Bellinger's WACC is 9% 1 3 0 2 4 Project A -950 650 385 260 310 Project B -950 250 320 410 760 What is Project A's payback? Do not found intermediate calculations. Round your answer to four decimal places. years What is Project A's discounted payback? Do not round intermediate calculations. Round your answer to four decimal places years What is Project B's payback? Do not round Intermediate calculations, Round your answer to four decimal places. years What is Project B's discounted payback? Do not round intermediate calculations. Round your answer to four decimal places. years OCX Exam 2 Formula....pdf

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