Explore BrainMass

Explore BrainMass

    NPV of Two Mutually Exclusive Projects

    Not what you're looking for? Search our solutions OR ask your own Custom question.

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    Evaluate 2 mutually exclusive project projects using DCF methods.
    Cost of capital on both projects is 10%

    Initial outlay for both projects is $100,000.

    Both projects will be completed in 3 years.

    Project A - will return $60,000 at the end of each of its first 2 years and then there will be no cash flow for its third year.

    Project B - will return no cash flow for years one and two, and then it will generate $140,000. at the end of the third year.

    © BrainMass Inc. brainmass.com December 24, 2021, 5:53 pm ad1c9bdddf
    https://brainmass.com/business/net-present-value/npv-two-mutually-exclusive-projects-77445

    Solution Summary

    Evaluates two mutually exclusive projects using NPV.

    $2.49

    ADVERTISEMENT