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Calculate npv for each project

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Reference no: EM132273613

CAPITAL BUDGETING

A firm with a 13% WACC is evaluating two projects for this year's capital budget. After-tax cash flows, including depreciation, are as follows:

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a. Calculate NPV for each project. Round your answers to the nearest cent. Do not round your intermediate calculations.

Calculate IRR for each project. Round your answers to two decimal places. Do not round your intermediate calculations.

Calculate MIRR for each project. Round your answers to two decimal places. Do not round your intermediate calculations.

Calculate payback for each project. Round your answers to two decimal places. Do not round your intermediate calculations.

Calculate discounted payback for each project. Round your answers to two decimal places. Do not round your intermediate calculations.

b. Assuming the projects are independent, which one(s) would you recommend?

c. If the projects are mutually exclusive, which would you recommend?

d. Notice that the projects have the same cash flow timing pattern. Why is there a conflict between NPV and IRR?

Attachment:- CAPITAL BUDGETING.rar

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The assignment is prepared to analyze and discuss the definition and scope of NPV, IRR, MIRR and payback period. A further discussion is also done regarding the conflict between NPV and IRR models and why the same occurs. This assignment was prepared in Microsoft word and APA referencing has been adopted for the same.

Reference no: EM132273613

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