Why the net present value is more favourable for the bridge

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On a typical days firm writes cheque totaling Tshs 300,000. These Cheques clear in seven days. Simultaneously,the firm receives Tshs 170,000. The Cash is available in two days on average.

Required:

Problem i. Calculate the disbursement ,the collection and the net float

Problem ii. How do you interpret the answers in (i) above

Problem iii. Explain why the net present value is more favourable for the bridge project than tunnel, while the internal rate of return gives the tunnel project as the best choice

Reference no: EM132936351

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