Question: Your company is considering two mutually exclusive projects. Project A has an initial cost of $80,000 and generates expected cash flows of $25,000 per year
Your company is considering two mutually exclusive projects. Project A has an initial cost of $80,000 and generates expected cash flows of $25,000 per year for six years. Project B has an initial cost of $80,000 and generates expected cash flows of $60,000 per year for two years. The firm's cost of capital is 12.00%. Determine which project you would choose. Choose B since the NPV is $22,785. O Choose A since the NPV is $21,403.5. 0 Choose B since the equivalent annuity payment is $12,664. Choose A since the equivalent annuity payment is $5,542. Cannot decide since two projects do not have equallife
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