I want the solv and with the details to how we solv it YearPlan AlphaPlan Beta12$1,700,000 $1,700,00021,700,0002,400,00031,700,0003,100,00041,700,0002,400,0001,700,0001,700,0001,700,0001,600,00071,700,0001,300,0008.1,700,0001,000,0009.1,700,000700,0001,700,0001,100,000102$Total17,000,000 $17,000,000 Questions:Crowell Company is considering two capital investments. Both investmentshave an initial cost of $9,000,000 and total net cash inflows of $17,000,000over 10 years. Crowell requires a 15% rate of return on this type of investment.Expected net cash inflows are as follows:Requirements1. Use Excel to compute the NPV and IRR of the two plans. Which plan, if any,should the company pursue?2. Explain the relationship between NPV and IRR. Based on this relationship andthe company's required rate of return, are your answers as expected inRequirement 1? Why or why not?3. After further negotiating, the company can now invest with an initial cost of$8,100,000. Recalculate the NPV and IRR. Which plan, if any, should thecompany pursue?PrintDone

Net Present Value: It is the present worth of the annual cash flows and the initial cost of the…

1. Use Excel to compute the NPV and IRR of the two plans. Which plan, if any, should the company pursue? 2. Explain the relationship between NPV and IRR. Based on this relationship and the company's required rate of return, are your answers as expected in Requirement 1? Why or why not? 3. After further negotiating, the company can now invest with an initial cost of $8,100,000. Recalculate the NPV and IRR. Which plan, if any, should the company pursue?

1. Use Excel to compute the NPV and IRR of the two plans. Which plan, if any, should the company pursue? 2. Explain the relationship between NPV and IRR. Based on this relationship and the company's required rate of return, are your answers as expected in Requirement 1? Why or why not? 3. After further negotiating, the company can now invest with an initial cost of $8,100,000. Recalculate the NPV and IRR. Which plan, if any, should the company pursue?

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter10: Capital Budgeting: Decision Criteria And Real Option

Section10.A: Mutually Exclusive Investments Having Unequal Lives

Problem 4P

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