Q1. (CLO3) All techniques with NPV profile—Mutually exclusive
projects Fitch Industries is in the process of choosing the better
of two equal-risk, mutually exclusive capital expenditure
projects—M and N. The relevant cash flows for each project are
shown in the following table. The firm’s cost of capital is
14%.
Project M
Project N
Initial investment
$28,500
$27,000
1
$10,000
$11,000
2
$10,000
$10,000
3
$10,000
9,000
4
$10,000
8,000
a. Calculate each project’s payback period.
b. Calculate the net present...