Your firm has faces the following investment alternatives


Your firm has faces the following investment alternatives, and can only select one project. Project A Project B Project C Project D Project E Time 0 -10,000 -10,000 -10,000 -10,000 -10,000 Time 1 5,000 4,000 3,000 4,000 2,000 Time 2 4,000 3,000 4,000 4,000 6,000 Time 3 3,000 10,000 5,000 4,000 10,000 a) Calculate the payback period for each project. If your company wants the shortest payback period possible, which project should you choose? b) Calculate the IRR for each project. Which project should you choose? c) Calculate the NPV for each project if the cost of capital is 8%. Which project should you choose?

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Financial Management: Your firm has faces the following investment alternatives
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