Calculate each projects payback period cutoff

Reference no: EM13264446

Puppy Inc. Has the following mutually exclusive investment opportunities. If the appropriate discount rate was 15% what should you do?

Year 0 Project X -500 Project Y -800
Year 1 Project X 100 Project Y 500
Year 2 Project X 475 Project Y 350
Year 3 Project X 50 Project Y 350

A. Calculate each projects payback period cutoff. Which would you accept if Puppy's payback period cutoff is 2 years?

B. Calculate each project's discounted payback period cutoff. Which would you accept if puppy's payback period cutoff is 2 years.?

C. What is the NPV for each project?

Reference no: EM13264446

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