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Garage, Inc., has identified the following two projects: Year Cash flow (A) Cash flow(B) 0 -$29,000...

Garage, Inc., has identified the following two projects:

Year

Cash flow (A)

Cash flow(B)

0

-$29,000

-$29,000

1

14,400

4,300

2

12,300

9,800

3

9,200

15,200

4

5,100

16,800

A and B are independent projects. Assume that the required rate of return is 11 percent.

1. What is Project B's NPV?

2. A and B are independent projects. Assume that the required rate of return is 11 percent.

Which project(s) should be accepted according to the NPV criterion?

3. A and B are independent projects. Assume that the required rate of return is 11 percent.

What is Project A's PI?

4. A and B are independent projects. Assume that the required rate of return is 11 percent.

What is Project B's PI?

5. A and B are independent projects. Assume that the required rate of return is 11 percent.

Which project(s) should be accepted according to the PI criterion?

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