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Which project should be chosen based on NPV?
5.
You have two mutually exclusive projects. The cost of capital is 11 percent. The cashflows are given below. Year Project A Year Project B Investment Cashflow 0 $2,000,000 Investment Cashflow 0 $1,000,000 1 $300,000 1 $100,000 2 $200,000 2 $100,000 3 $200,000 3 $100,000 4 $600,000 4 $400,000 |
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