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Determine desirable investment alternative according to npv

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Mr. Kulonda, VP of Operations at McClain Manufacturing, has to make a decision between two investment alternatives. Investment A has an initial cost of $61,000, and investment B has an initial cost of $74,000. The useful life of investment A is 6 years; the useful life of investment B is 7 years. Given a cost of capital of 9% and the following cash flows for each alternative, determine the most desirable investment alternative according to the net present value criterion.

Reference no: EM13879871

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