In: Finance
Consider the following two mutually exclusive projects: |
Year | Cash Flow (A) | Cash Flow (B) |
0 | –$335,008 | –$15,743 |
1 | 28,200 | 5,321 |
2 | 53,000 | 8,353 |
3 | 53,000 | 13,945 |
4 | 412,000 | 8,958 |
Whichever project you choose, if any, you require a 6 percent return on your investment. |
a. What is the payback period for Project A? |
b. What is the payback period for Project B? |
c. What is the discounted payback period for Project A? |
d. What is the discounted payback period for Project B? |
e. What is the NPV for Project A? |
f. What is the NPV for Project B ? |
g. What is the IRR for Project A? |
h. What is the IRR for Project B? |
i. What is the profitability index for Project A? |
j. What is the profitability index for Project B? |