The U3 Company is considering three long-term capital investment proposals. Each investment has a useful life of 5 years. Relevant data on each project are as follows: Project A Investment -275,000...


The U3 Company is considering three long-term capital investment proposals. Each investment has a useful life of 5 years. Relevant data on each project are as follows:





















































Project A
Investment



-275,000





Year 1



$40,000





Year 2



56,000





Year 3



80,295





Year 4



90,400





Year 5



55,000





Year 6



50,000





Year 7



45,000





Year 8



32,000
























































Project B
Investment



-275,000





Year 1



$72,000





Year 2



50,000





Year 3



66,000





Year 4



72,000





Year 5



29,000





Year 6



35,000





Year 7



22,000





Year 8



36,000
























































Project C
Investment



-275,000





Year 1



$82,000





Year 2



75,000





Year 3



65,000





Year 4



55,000





Year 5



45,000





Year 6



35,000





Year 7



25,000





Year 8



15,000








Required:



  1. Compute the Net Present Value for each project using the following present value interest factors:


    (0.9091  0.8264  0.7513  0.6830  0.6209  0.5644  0.5131  0.4664)



  1. Select the best investment (mutually exclusive events)







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Jun 02, 2022
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