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problem: Two mutually exclusive investment projects have the following estimated cash flows:

Year

A

B

0

$ -20,000

$ -20,000

1

     10,000

0

2

10,000

0

3

10,000

0

4

10,000

60,000

[A] find out the internal rate of return for each project.

[B] find out the net present value for each project if the firm has a 10% cost of capital.

[C] Determine and describe which project should be adopted?

 

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M918450

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