600 900 500 900 500 900

Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter12: Capital Budgeting: Decision Criteria
Section: Chapter Questions
Problem 13P
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Question
Consider the cash flows for the following investment projects. Assume that MARR=12%/year.
A
B
C
0 - PhP 1,000 – PhP 1,000 - PhP2,000
1
900
600
900
2
500
500
900
100
500
900
4
50
100
900
Which project should be selected using incremental analysis (AW method)?
ANSWERS:
AWA = PhP Blank 1
AWB = PhP Blank 2
AWC = PhP Blank 3
AW (B-A) = PhP Blank 4
AW (C-B) = PhP Blank 5
Investment Blank 6 (use capital letter) is better.
Transcribed Image Text:Consider the cash flows for the following investment projects. Assume that MARR=12%/year. A B C 0 - PhP 1,000 – PhP 1,000 - PhP2,000 1 900 600 900 2 500 500 900 100 500 900 4 50 100 900 Which project should be selected using incremental analysis (AW method)? ANSWERS: AWA = PhP Blank 1 AWB = PhP Blank 2 AWC = PhP Blank 3 AW (B-A) = PhP Blank 4 AW (C-B) = PhP Blank 5 Investment Blank 6 (use capital letter) is better.
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How do you solve the Annual Worth (AW) of A & B manually? without using excel

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