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Decision to accept project-present value index decision rule

The Robb Computer Corporation is trying to choose between the following two mutually exclusive design projects:

Year CF Project I CF Project II

0 -30000 -5000

1 15000 2800

2 15000 2800

3 15000 2800

a) If the required return is 10% and Robb Computer applies the present value index decision rule, which project should the firm accept?

b) If the company applies the NPV decision rule, which project should it take?

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Solution Preview :

Prepared by a verified Expert

Finance Basics: Decision to accept project-present value index decision rule

Reference No:- TGS0678565

Have a Question? (oR Write a Review)

Recent Questions Asked Finance Basics

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Solution Preview :

Prepared by a verified Expert

Finance Basics: Decision to accept project-present value index decision rule

Reference No:- TGS0678565

Recent Questions Asked Finance Basics

Q : Determine the value of a share of kti-s stock

Q : How much tax is currently owed to the us government

Q : Education in saudi arabia

Q : Determine a schedule of expected cash collections for July

Q : Decision to accept project-present value index decision rule

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