Question: Module 7 Chapter 10 CASE VI: Capital Budgeting Suppose your firm is considering investing in a project with the cash flows shown as follows, that
Module 7 Chapter 10 CASE VI: Capital Budgeting Suppose your firm is considering investing in a project with the cash flows shown as follows, that the required rate of return on projects of this risk class is 11 percent, and that the maximum allowable payback and discounted payback statistics for your company are 3 and 3.5 years, respectively. Time 0 1 2 3 4 5 $65,800 $94,000 $41,000 $122,000 $122,000 $81,200 Cash Flow $175,000 Using every one of the 6 capital budgeting decision methods discussed in this chapter (Payback, Discounted Payback, NPV, IRR, MIRR, PI), evaluate this project, indicating whether each decision rule would call for acceptance or rejection of the project
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