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Suppose your firm is considering two mutually exclusive,required projects with the cash flows shown below. The requiredrate of return on projects of both of their risk class is 9percent, and that the maximum allowable payback and discountedpayback statistic for the projects are 2 and 3 years, respectively.Time: 0 1 2 3 Project A Cash Flow -36,000 26,000 46,000 17,000Project B Cash Flow -46,000 26,000 36,000 66,000 Use the discountedpayback decision rule to evaluate these projects; which one(s)should be accepted or rejected? ? accept neither A nor B ? acceptboth A and B ? accept A, reject B ? reject A, accept B
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