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Q. Wilderness Adventures specializes in back-country tours and resort management. Travel Excitement specializes in making travel reservations and promoting vacation travel. Wilderness Adventures has an after-tax cost of capital of 13 percent and Travel Excitement has an after-tax cost of capital of 11 percent. Both organizations are considering building wilderness campgrounds complete with man-made lakes and hiking trails. The estimated net present value of such a project is estimated at $87,000 at a discount rate of 11 percent and -$12,500 at a 13 percent discount rate. Which organization or organizations, if either, should accept this project?

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Business Management, Management Studies

Category:- Business Management
Reference No.:- M9379392

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