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FinanceQ&A LibraryTri Star, Inc., has the following mutually exclusive projects: YearProject A Project B0–$13100 –$8500 1 7300 3200 2 6300 2700 3 2,100 5100 Calculate the payback period for each project. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) If the appropriate discount rate is 9 percent, what is the NPV for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)Question

Asked Nov 11, 2019

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Tri Star, Inc., has the following mutually exclusive projects:

Year | Project A | Project B | |||||

0 | –$ | 13100 | –$ | 8500 | |||

1 | 7300 | 3200 | |||||

2 | 6300 | 2700 | |||||

3 | 2,100 | 5100 | |||||

Calculate the payback period for each project. **(Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)**

**If the appropriate discount rate is 9 percent, what is the NPV for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)**

Step 1

**Calculation of Payback Period and Net Present Value:**

The payback period for Project A is **1.92 years** and for Project B is **2.51 years**.

The net present value for Project A is **$521.42** and for Project B is **$646.45**.

**Excel Spreadsheet:...**

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