A firm has the following investment alternatives. Each one lasts a year. C Investment A Cash inflow Cash outflow $1,017 $900 B 666 600 702 600 The firm's cost of capital is 7 percent. A and B are mutually exclusive, and B and C are mutually exclusive. a. What is the net present value of investment A? Investment B? Investment C? Use a minus sign to enter negative values, if any. Round your answers to the nearest cent. A: $ B: $ C: $ b. What is the internal rate on investment A? Investment B? Investment C? Round your answers to the nearest whole number. A: % B: C: % c. Which investment(s) should the firm make?

A firm has the following investment alternatives. Each one lasts a year. C Investment A Cash inflow Cash outflow $1,017 $900 B 666 600 702 600 The firm's cost of capital is 7 percent. A and B are mutually exclusive, and B and C are mutually exclusive. a. What is the net present value of investment A? Investment B? Investment C? Use a minus sign to enter negative values, if any. Round your answers to the nearest cent. A: $ B: $ C: $ b. What is the internal rate on investment A? Investment B? Investment C? Round your answers to the nearest whole number. A: % B: C: % c. Which investment(s) should the firm make?

Financial And Managerial Accounting

15th Edition

ISBN:9781337902663

Author:WARREN, Carl S.

Publisher:WARREN, Carl S.

Chapter26: Capital Investment Analysis

Section: Chapter Questions

Problem 3CMA

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