Use the table for the question(s) below.
Consider the following two projects:

-Assume that projects Alpha and Beta are mutually exclusive.The correct investment decision and the best rational for that decision is to

Question

Use the table for the question(s) below.
Consider the following two projects:
 
-Assume that projects Alpha and Beta are mutually exclusive.The correct investment decision and the best rational for that decision is to

Quizplus · Accepted Answer

D) NPV Alpha
NPV = -79 + 20 / (1.15)¹ + 25 / (1.15)² + 30 / (1.15)³ + 35 / (1.15)⁴ + 40 / (1.15)⁵ = 16.92
NPV Beta
NPV = -80 + 25 / (1.16)¹ + 25 / (1.16)² + 25 / (1.16)³ + 25 / (1.16)⁴ + 25 / (1.16)⁵ +
50 / (1.16)⁶ + 25 / (1.16)⁷ = 20.96
IRR Alpha
CF₀ = -79
CF₁ = 20
CF₂ = 25
CF₃ = 30
CF₄ = 35
CF₅ = 40
Compute IRR = 22.68.
IRR Beta
PV = -80
PMT = 25
FV = 0
N = 7
Compute I = 24.52.

Use the Table for the Question(s) Below