What is project a and bs net present value

Reference no: EM133633100

Question: Your division is considering two investment projects, each of which requires an up-front expenditure of $22 million. Project A will have cash flows of $3 million in year 1, $4 million in year 2, $8 million in year 3, and $18 million in year 4. Project B will have cash flows of $17 million in year 1, $9 million in year 2, $4 million in year 3, and $2 million in year 4.

Assume the projects are independent.

What is Project A and B's net present value, assuming the cost of capital is 6%?

Reference no: EM133633100

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