Your division is considering two investment projects, each of which requires an up-front expenditure of $20...

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Finance

Your division is considering two investment projects, each ofwhich requires an up-front expenditure of $20 million. You estimatethat the investments will produce the following net cashflows:
Year                      ProjectA             Project B
1                             $5,000,000          $20,000,000
2                             10,000,000          10,000,000
3                             20.000.000          6,000,000
       What are the two project’sNPVs assuming the cost of capital is 8%, 14%, 20%?
       What are the two projects’IRRs at those same costs of capital?

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Your division is considering two investment projects, each ofwhich requires an up-front expenditure of $20 million. You estimatethat the investments will produce the following net cashflows:Year ProjectA Project B1 $5,000,000 $20,000,0002 10,000,000 10,000,0003 20.000.000 6,000,000 What are the two project’sNPVs assuming the cost of capital is 8%, 14%, 20%? What are the two projects’IRRs at those same costs of capital?