For the following projects, compute NPV,IRR,MIRR,profitability index, and payback. If these projects are mutually exclusive, which one(s) should be done? If they are independant, which one(s) should be undertaken?
A B C D
Year 0 -1000 -1500 -500 -2000
year 1 400 500 100 600
year 2 400 500 300 800
year 3 400 700 250 200
year 4 400 200 200 300
discount rate 10% 12% 15% 8%
For the following projects, compute NPV,IRR,MIRR,profitability index, and payback. If these projects are mutually exclusive, which one(s) should be done? If they are independant, which one(s) should be undertaken?
A B C D
Year 0 -1000 -1500 -500 -2000
year 1 400 500 100 600
year 2 400 500 300 800
year 3 400 700 250 200
year 4 400 200 200 300
discount rate 10% 12% 15% 8%
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Related questions
Company A has the opportunity to do any, none, or all of the projects for which the net cash flows per year are shown below. Projects A and C can be done together. Projects B and C can be done together. But Projects A and B are mutually exclusive. The company has a cost of capital of 18%. Which should the company do and why? You must use at least two capital budgeting methods. Show your work.
| A | B | C | |
| 0 | -500 | -500 | -600 |
| 1 | 200 | -200 | 100 |
| 2 | 200 | 600 | 100 |
| 3 | 200 | 400 | 100 |
| 4 | 200 | 200 | 100 |
| 5 | 200 | -300 | 100 |
| 6 | 200 | 100 | |
| 7 | -300 | 100 |
A and B are mutually exclusive projects. The required rate of return is 10%.
The cutoff period is 2 years.
| Year | Project A | Project B |
| 0 | -$1,000 | -$1,000 |
| 1 | 500 | 100 |
| 2 | 400 | 300 |
| 3 | 300 | 400 |
| 4 | 100 | 675 |
If the company applies payback period decision, which project should be recommended?
a Project A because it has payback of 2.33 years.
b. Project A because it has payback of 2.107 years.
c. Project B because it has payback of 2.33 years.
d. Project B because it has payback of 3.30 years.
e. Neither of two projects is recommended.
