?You have been assigned the task of evaluating two mutually exclusive projects with the following projected...

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Finance

?You have been assigned the task of evaluating two mutuallyexclusive projects with the following projected cash? flows:
Year
Project A
Cash Flow
Project B
Cash Flow
0
?$(102,000?)
?$(102,000)
1
32,000
???????????00
2
???32,000
???????????00
3
???32,000
???????????00
4
???32,000
???????????00
5
???32,000
??230, 000
If the appropriate discount rate on these projects is 88?percent, which would be chosen and? why?
The NPV of Project A is

Answer & Explanation Solved by verified expert

4.1 Ratings (535 Votes)

Net Present Value PROJECT A Year Annual Cash Flow Present Value factor at 8 Present Value of Cash Flow 1 32000 0925926 2962963 2 32000 0857339 2743484 3 32000 0793832 2540263 4 32000 0735030 See Answer

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Transcribed Image Text

?You have been assigned the task of evaluating two mutuallyexclusive projects with the following projected cash? flows:YearProject ACash FlowProject BCash Flow0?$(102,000?)?$(102,000)132,000???????????002???32,000???????????003???32,000???????????004???32,000???????????005???32,000??230, 000If the appropriate discount rate on these projects is 88?percent, which would be chosen and? why?The NPV of Project A is

Year	Project A Cash Flow	Project B Cash Flow
0	?$(102,000?)	?$(102,000)
1	32,000	???????????00
2	???32,000	???????????00
3	???32,000	???????????00
4	???32,000	???????????00
5	???32,000	??230, 000