Question: The Robb Computer Corporation is trying to choose between the following two mutually exclusive design projects: a. If the required rate of return is 10

The Robb Computer Corporation is trying to choose between the following two mutually exclusive design projects:

a. If the required rate of return is 10 percent and Robb Computer applies the profitability index decision rule, which project should the firm accept?
b. If the company applies the NPV decision rule, which project should it take?
c. Explain why your answer in (a) and (b) aredifferent.

Year Cash Flow (1) Cash Flow (2) S40,000 21,000 21,000 21,000 $15,000 8,500 8,500 8.500

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