Homework answers / question archive / Suppose that the cash flows of two investments are as follows: Unit $1000 CASH FLOW AT YEAR 1 3 4 Investment (12,000,000) 6,000,000 5,500,000 3,300,000 2,500,000 Τ 2 0 s 2,000,000 Investment (12,000 000) 3,000,000 4,000,000 5,000,000 5,500,000 5,000,000 1 Using the investment decision rules (ie NPV & IRR) to select the best investment Suppose that the hurdle rate, r is 15%

Suppose that the cash flows of two investments are as follows: Unit $1000 CASH FLOW AT YEAR 1 3 4 Investment (12,000,000) 6,000,000 5,500,000 3,300,000 2,500,000 Τ 2 0 s 2,000,000 Investment (12,000 000) 3,000,000 4,000,000 5,000,000 5,500,000 5,000,000 1 Using the investment decision rules (ie NPV & IRR) to select the best investment Suppose that the hurdle rate, r is 15%

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Suppose that the cash flows of two investments are as follows: Unit $1000 CASH FLOW AT YEAR 1 3 4 Investment (12,000,000) 6,000,000 5,500,000 3,300,000 2,500,000 Τ 2 0 s 2,000,000 Investment (12,000 000) 3,000,000 4,000,000 5,000,000 5,500,000 5,000,000 1 Using the investment decision rules (ie NPV & IRR) to select the best investment Suppose that the hurdle rate, r is 15%