Braun Industries is considering the following mutually exclusive projects. Braun’s cost of capital is 9%.            Year        Project A                Project...

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Finance

Braun Industries is considering the following mutually exclusiveprojects. Braun’s cost of capital is 9%.

          Year        ProjectA               Project B

           0            ($86,000)               ($86,000)

           1            $42,000                 $63,000

           2            $32,000                 $28,000

3            $12,900                 $8,000     

4            $12,200                 $3,000

5            $12,000                 $2,000

a.   Calculate eachproject’s NPV and IRR.

b.   Find the Payback Periodfor each project.

c.   Find the MIRR for eachproject.

d.   Which of these projectsshould Braun accept? Why?

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Braun Industries is considering the following mutually exclusiveprojects. Braun’s cost of capital is 9%.          Year        ProjectA               Project B           0            ($86,000)               ($86,000)           1            $42,000                 $63,000           2            $32,000                 $28,0003            $12,900                 $8,000     4            $12,200                 $3,0005            $12,000                 $2,000a.   Calculate eachproject’s NPV and IRR.b.   Find the Payback Periodfor each project.c.   Find the MIRR for eachproject.d.   Which of these projectsshould Braun accept? Why?

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