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# Accounting payback, Financial payback, NPV, & IRR

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Given on Project A and Project B, both 4 yr. projects:

Project A Project B
Investment \$750,000 \$900,000

4 yrs. C/F (1) \$200,000 (1) \$300,000
(2) \$250,000 (2) \$325,000
(3) \$275,000 (3) \$200,000
(4) \$300,000 (4) \$250,000

k = 10% 9%

Calculate for both projects Accounting payback, Financial payback, NPV, & IRR. For each project, should you go ahead with investment and why or why not? And if project were mutually exclusive, which one, if either should you invest in and why?

#### Solution Preview

Given on Project A and Project B, both 4 yr. projects:

Project A Project B
Investment \$750,000 \$900,000

4 ...

#### Solution Summary

This explains the steps to compute the Accounting payback, Financial payback, NPV, & IRR

\$2.49