Question: Save & Exit Here are the expected cash flows for three projects Cash Flows dollars Project YEAR 1 -5, 100 -1,025 + 1.025 3,050 -
Save & Exit Here are the expected cash flows for three projects Cash Flows dollars Project YEAR 1 -5, 100 -1,025 + 1.025 3,050 - 1.100 0 - 1.100 - 2.050 - 5.100 + 1,025 + 1,025 +1.050 O +3,050 - 5,050 a. What is the payback period on each of the projects b. If you use the payback rule with a cutoff period of 2 years, which projects will you accept? c. If you use a cutoff period of 3 years, which projects will you accept? d-1. If the opportunity cost of capital is 11%, calculate the NPV for projects A, B, and C. (Negative amounts should be indicated by a minus sign. Do not round Intermediate calculations. Round your answers to 2 decimal places.) d-2. Which projects have positive NPVS? e. "Payback gives too much weight to cash flows that occur after the cutoff date." True or false? Project Project Years Projects Years Years a. Payback period b. w you use the payback rule with a cutor period of 2 years, which projects will you accept? c. if you use a cutor period of 3 years, which projects will you accept? d-1. If the opportunity cost of capital is 11%, calculate the NPV for projects A B, and C. d-2. Which projects have positive NPVS? "Payback gives too much weight to cash flows that occur after the cutoff date. True or false
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