Question: Suppose your firm is considering two mutually exclusive, required projects with the cash flows shown below. The required rate of return on projects of both

 Suppose your firm is considering two mutually exclusive, required projects with

Suppose your firm is considering two mutually exclusive, required projects with the cash flows shown below. The required rate of return on projects of both of their risk class is 9 percent, and that the maximum allowable payback and discounted payback statistic for the projects are 2 and 3 years, respectively. Time: Project A Cash Flow Project B Cash Flow 0 1 2 3 -36,000 26,000 46,000 17,000 -46.000 26,000 36,000 66,000 Use the Pl decision rule to evaluate these projects; accept the project with the higher Pl value. Multiple Choice accept neither A nor B accept both A and B

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