6, Sungsam Electronics has to choose between two investment options Eachalternative involves an initial outlay of $100,000. Their cash flows follow:YearA$10,00020,00030,00040,00050,000B$50,00040,00030,000134Evaluate and rank each alternative based ona) payback periodb) net present value (use a 10% discount rate)c) internal rate of return. (Hint: Use Cash flows in Calculator for Parts b & c)

Initial Investment = 100,000 Cash Flows: Year Cash Flow - A Cash Flow - B 0 -100,000 -100,000…

Sungsam Electronics has to choose between two investment options Each alternative involves an initial outlay of $100,000. Their cash flows follow: Year A $10,000 20,000 30,000 40,000 50,000 B $50,000 40,000 30,000 1 Evaluate and rank each alternative based on a) payback period b) net present value (use a 10% discount rate)

Sungsam Electronics has to choose between two investment options Each alternative involves an initial outlay of $100,000. Their cash flows follow: Year A $10,000 20,000 30,000 40,000 50,000 B $50,000 40,000 30,000 1 Evaluate and rank each alternative based on a) payback period b) net present value (use a 10% discount rate)

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter11: Capital Budgeting And Risk

Section: Chapter Questions

Problem 8P

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