Question: Please answer #5 and #6. The first 4 have been answered already. (25) Points The Big CompanyTM is considering two pieces of machinery that perform

 Please answer #5 and #6. The first 4 have been answered

Please answer #5 and #6. The first 4 have been answered already.

(25) Points The Big CompanyTM is considering two pieces of machinery that perform the same repetitive task. The two alternatives available provide the following set of after-tax net cash flows. Assuming a required rate of return of 10%: Year Project A Project B Calculate the NPV for each project 0 (48,000) (80,000) Calculate the IRR for each project. 1 19000 19000 Calculate the uniform annual series (UAS) or the equivalent annual annuity (EAA) for each project. 19000 19000 Compare the two projects using the replacement chain method (i.e. find the 3 19000 19000 replacement chain value). Which project would you select? 19000 Calculate the discounted payback. (11) Convert this to a rate of return. 19000 If the projects are mutually exclusive, and can be reproduced which project 19000 do you select? Explain 19000 2 4 5 6 7

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