Cash flows are after tax and depreciation

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Peter is considering two projects from the market. the first one's Initial Outlay (IO) is $4,500,000; Annual Cash Flows (CF) is $1,000,000; Life of system is 10 Years. And the second one's information is Initial Outlay (IO) is $8,000,000; Annual Cash Flows (CF) is $2,000,000; Life of System is 7 Years. It shows all the cash flows are after tax and depreciation and the flat rate of 12% is estimated as the risk in both of these projects. Could you show the all the calculation and which one is better?

Reference no: EM132046471

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