17.0 (remember to consider the delivery/installation costs) Project A has a cost of $17.0M& delivery &...

  

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17.0 (remember to consider the delivery/installation costs) Project A has a cost of $17.0M& delivery & installation costs of $1.5M. Weighted Average Cost of Capital (WACC) 15%. The FCF growth rate (G) after the Sth year in the (timeline) forecast period= 2%. NPV = $ 77.69 M IRR = 62.96% MIRR= 59.22% Based on financial analyses, Project Z has the criteria/return illustrated below. If Project A (from above) & Z are "mutually exclusive" (you could do only one of them), which one would you do? Expected Net After-Tax Free Cash Flows for Project A are shown below. 12.0 (remember to consider the "terminal value") Terminal Value (TV) (FCFS) (1+G) + (WACC-G) Year Net Free Cash Flow (MS) 1 5.5 8.7 119 15.1 4 (10 points) A. Project A B. Project Z Project 7: Payback = 1.83 years 17.0 (remember to consider the delivery/installation costs) Project A has a cost of $17.0M& delivery & installation costs of $1.5M. Weighted Average Cost of Capital (WACC) 15%. The FCF growth rate (G) after the Sth year in the (timeline) forecast period= 2%. NPV = $ 77.69 M IRR = 62.96% MIRR= 59.22% Based on financial analyses, Project Z has the criteria/return illustrated below. If Project A (from above) & Z are "mutually exclusive" (you could do only one of them), which one would you do? Expected Net After-Tax Free Cash Flows for Project A are shown below. 12.0 (remember to consider the "terminal value") Terminal Value (TV) (FCFS) (1+G) + (WACC-G) Year Net Free Cash Flow (MS) 1 5.5 8.7 119 15.1 4 (10 points) A. Project A B. Project Z Project 7: Payback = 1.83 years

Answer rating: 100% (QA)

Cash flows would be Year 0 1715185 Year 1 55 Year ... View the full answer