XYZ Construction is considering two projects to develop. The expected cash inflows are as follows : Project

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XYZ Construction is considering two projects to develop. The expected cash inflows are as follows :

Project MProject N

Year 110,00025,000

Year 215,00025,000

Year 3 20,00025,000

Year 425,00025,000

Year 530,00025,000

Each Project requires an investment of $100,000. A rate of 10% has been selected for the

NPV Analysis.

Required :

a)Calculate the NPV and the Profitability Index and suggest which project should be

recommended based on each method.

b)Explain what are the key decisions a Finance Manager has to take in an

Organization with suitable examples.

Related Book For answer-question

Fundamental Managerial Accounting Concepts

ISBN: 978-0078025655

7th edition

Authors: Thomas Edmonds, Christopher Edmonds, Bor Yi Tsay, Philip Old

See More Books

Posted Date: May 14, 2024 02:26 AM

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XYZ Construction is considering two projects to develop. The expected cash inflows are as follows : Project

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Fundamental Managerial Accounting Concepts

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