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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.

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Solution Summary

Evaluates two mutually exclusive projects using NPV.

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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       ...

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