1 capital budget analysis of mutually exclusive projects a


1. Capital budget analysis of mutually exclusive projects A and B Yields the following:

Project A Project B

IRR 18% 22%

NPV $270,000 $255,000

Payback Period 2.5 Yrs 2.0 Yrs

Management should choose:

A. Project B because most excutives prefer the IRR method

B. Project B because Two out of three methods choose it

C. Project A because NPV is the best method

D. Either project because the results aren't consistent

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Business Management: 1 capital budget analysis of mutually exclusive projects a
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