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    NPV of Mutually Exclusive Projects

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    As the director of capital budgeting for ABC Corporation, you are evaluating two mutually exclusive projects with the following net cash flows:

    A B

    -200,000 -125,000

    1 65,000 60,000

    2 60,000 40,000

    3 50,000 40,000

    4 65,000 35,000

    5 50,000 45,000

    If ABC Corporations cost of capital is 12%, defend which project you would choose.

    © BrainMass Inc. brainmass.com October 9, 2019, 11:25 pm ad1c9bdddf
    https://brainmass.com/business/net-present-value/npv-mutually-exclusive-projects-255781

    Solution Preview

    Please see the attached Excel file for answer
    As the director of capital budgeting for ABC Corporation, you are evaluating two mutually exclusive projects with the following net cash flows:

            A              B

       -200,000       ...

    Solution Summary

    Evaluates two mutually exclusive projects using NPV.

    $2.19