CPU chips with lower power consumption and heat generation

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Reference no: EM131027144

Consider two mutually exclusive R&D projects that ADM is considering. Assume the discount rate for ADM is 13 percent. Project A: Server CPU .13 micron processing project By shrinking the die size to .13 micron, ADM will be able to offer server CPU chips with lower power consumption and heat generation, meaning faster CPUs. Project B: New telecom chip project Entry into this industry will require introduction of a new chip for cell phones. The know-how will require a large amount of up-front capital, but success of the project will lead to large cash flows later on. Year Project A Project B 0 –$ 1,000,000 $355.,000 345,000 320,000 320,000 230,000 736,000 271,000 284,000 269,000 255,000 196,000 Complete the following table

Reference no: EM131027144

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