Question: Shams company is considering two projects. Each requires an initial investment of OMR 100,000. The company cost of capital is 14%. The cash inflows associated
- Shams company is considering two projects. Each requires an initial investment of OMR 100,000. The company cost of capital is 14%. The cash inflows associated with each project are as follows:
|
| Cash inflows | |
| Year | Project A | Project B |
| 1 | 30,000 | 60,000 |
| 2 | 25,000 | 50,000 |
| 3 | 30,000 | 20,000 |
| 4 | 40,000 | 10,000 |
| 5 | 20,000 | 20,000 |
- B\. Which project you would recommend to the management. Explain why. (1 Mark)
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