Question: please answer all three parts, there are answer for 1 and 2 in chegg. Q-1: Two new software projects are proposed to a young, start-up
please answer all three parts, there are answer for 1 and 2 in chegg.
Q-1: Two new software projects are proposed to a young, start-up company. The Alpha project will cost $150,000 to develop and is expected to have annual net cash flow of $40,000. The Beta project will cost $200,000 to develop and is expected to have annual net cash flow of $50,000. The company is very concerned about their cash flow. Using the payback period, which project is better from a cash flow standpoint? Why?
Q-2: You have four possible projects but can only choose one. Project A is being done over a six-year period and has a net present value (NPV) of $70,000. Project B is being done over a three-year period and has an NPV of $30,000. Project C is being done over a ten-year period and has an NPV of $40,000. Project D is being done over a one-year period and has an NPV of negative $160,000. Which project should you choose?
a- Project A
b- Project B
c- Project C
d- Project D
Q-3: You have four possible projects but can only choose one. Project A is being done over a six-year period and has a net present value (NPV) of $70,000. Project B is being done over a three-year period and has an NPV of $30,000. Project C is being done over a ten-year period and has an NPV of $40,000. Project D is being done over a one-year period and has an NPV of negative $160,000. To know which project to choose, you want to make sure you understand all involved selection methods. What is definition of present value?
a- Value of assets a company owns
b- Todays value of future cash flows
c- Future value of money on hand today
d- Current value of todays assets adjusted for inflation
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