Define net present value method for the project

Reference no: EM131788394

Question: Diaz Camera Company is considering two investments, both of which cost $10,000. The cash flows are as follows:

a. Which of the two projects should be chosen based on the payback method?

b. Which of the two projects should be chosen based on the net present value method? Assume a cost of capital of 10 percent.

c. Should a firm normally have more confidence in answer a or answer b?

Reference no: EM131788394

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