Question: paper written Question 2 (26 marks) A&B Enterprises is trying to select the best investment from two alternatives. Cash flows for each alternative are: Initial
Question 2 (26 marks) A&B Enterprises is trying to select the best investment from two alternatives. Cash flows for each alternative are: Initial outlay $ 106,000 $ 106,000 Year I 2 3 4 5 Investment A Investment B $9,000 $56,000 $24,000 $51,000 $29,000 $35,000 $68,000 0 $69,000 0 For each of the investments, calculate the following (use a 10% discount rate): (a) Payback period (b) Internal rate of return (c) For each method individually, which is the better investment
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