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Calculate each project payback period

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Reference no: EM133128743

Question - Assume that you are the COO at Cactus Valley Medical Center. The CEO has asked you to analyze two proposed capital investments-Project X and Project Y. Each project requires a net investment outlay of $10,000, and the cost of capital for each project is 12 percent. The expected net cash flows for each project are as follow:

Year

Project X

Project Y

1

6,500

3,000

2

3,000

3,000

3

3,000

3,000

4

1,000

3,000

Required -

1. Calculate each project's payback period, net present value (NPV), and internal rate of return (IRR).

2. Which project(s) is/are financially acceptable? Explain your answer.

Reference no: EM133128743

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