Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 –$65,000 –$250,000 1 35,000 25,000 2 27,000...

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Finance

Consider the following two mutually exclusive projects:
Year Cash Flow (A) Cash Flow (B)
0 –$65,000       –$250,000
1 35,000       25,000
2 27,000       70,000
3 25,000       70,000
4 41,000       320,000
The required return on these investments is 10 percent.
Required:
(a)
What is the payback period for each project?(Do not round intermediatecalculations. Round your answers to 2 decimalplaces (e.g., 32.16).)
Payback period
  Project A years
  Project B years
(b)
What is the NPV for each project? (Donot round intermediate calculations. Round youranswers to 2 decimal places(e.g.,32.16).)
Net present value
  Project A $
  Project B $
(c)
What is the IRR for each project? (Donot round intermediate calculations. Enter youranswer as a percentage rounded to 2 decimal places (e.g.,32.16).)
Internal rate of return
  Project A %
  Project B %
(d)
What is the profitability index for each project?(Do not round intermediatecalculations. Round your answersto 3 decimal places (e.g., 32.161).)
Profitability index
  Project A
  Project B
(e) Based only on the projects' NPV and IRR, which project shouldyou finally choose?
(Click to select)Project A Project B Cannot Be Determined

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Consider the following two mutually exclusive projects:YearCash Flow (A)Cash Flow (B)0–$65,000 –$250,000 135,000 25,000 227,000 70,000 325,000 70,000 441,000 320,000 The required return on these investments is 10 percent.Required:(a)What is the payback period for each project?(Do not round intermediatecalculations. Round your answers to 2 decimalplaces (e.g., 32.16).)Payback period Project Ayears Project Byears (b)What is the NPV for each project? (Donot round intermediate calculations. Round youranswers to 2 decimal places(e.g.,32.16).)Net present value Project A$ Project B$ (c)What is the IRR for each project? (Donot round intermediate calculations. Enter youranswer as a percentage rounded to 2 decimal places (e.g.,32.16).)Internal rate of return Project A% Project B% (d)What is the profitability index for each project?(Do not round intermediatecalculations. Round your answersto 3 decimal places (e.g., 32.161).)Profitability index Project A Project B (e)Based only on the projects' NPV and IRR, which project shouldyou finally choose?(Click to select)Project A Project B Cannot Be Determined

Year	Cash Flow (A)	Cash Flow (B)
0	–$65,000	–$250,000
1	35,000	25,000
2	27,000	70,000
3	25,000	70,000
4	41,000	320,000

Required:
(a)	What is the payback period for each project?(Do not round intermediatecalculations. Round your answers to 2 decimalplaces (e.g., 32.16).)

(e)	Based only on the projects' NPV and IRR, which project shouldyou finally choose?

	(Click to select)Project A Project B Cannot Be Determined