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| Teaching Since: | Apr 2017 |
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| Questions Answered: | 3232 |
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MBA,MCS,M.phil
Devry University
Jan-2008 - Jan-2011
MBA,MCS,M.Phil
Devry University
Feb-2000 - Jan-2004
Regional Manager
Abercrombie & Fitch.
Mar-2005 - Nov-2010
Regional Manager
Abercrombie & Fitch.
Jan-2005 - Jan-2008
Oldguy Inc. is considering two independent investments with the following cash flow streams:
| Â |
initial |
Year 1 |
Year 2 |
Year 3 |
Year 4 |
Year 5 |
|
Proj A |
-50,000 |
+20,000 |
+20,000 |
+10,000 |
+5,000 |
+5,000 |
|
Proj B |
-50,000 |
+10,000 |
+10,000 |
+5,000 |
+5,000 |
+50,000 |
Oldguy uses a combination of NPV and Payback period to evaluate alternatives, with a requirement of a positive NPV using a 10% discount rate and a maximum payback of 3 years. Which project(s) should Oldguy select?
Â
| Â | a. |
A and B |
| Â | b. |
A only |
| Â | c. |
neither A nor B |
| Â | d. |
B only |
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