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You are a financial analyst for a certain company. The director of capital budgeting has asked you to analyze two proposed capital investments. Each project has a cost of $ 10,000 and the cost of capital of each project is 12 % .The projects’ expected net cash flow are as follows

Answer the following question based on the above information:
Projects payback period and NPV
Which project or projects should be accepted if they are independent
Which project should be accepted if they are mutually exclusive

1 answer

To analyze the proposed capital investments, we will need to calculate the payback period and the Net Present Value (NPV) for each project. However, you've provided incomplete information regarding the expected net cash flows for the projects. Please provide the expected net cash flows for each year for each of the two projects in order to proceed with the analysis.

Once you provide that information, I can help you calculate the payback period and NPV for each project and determine which project(s) to accept under independent and mutually exclusive scenarios.