Question

Consider the following cash flows of two mutually exclusive projects for A–Z Motorcars. Assume the discount rate for both projects is 12 percent. Year AZM Mini-SUV AZF Full-SUV 0 –$ 525,000 –$ 875,000 1 335,000 365,000 2 210,000 450,000 3 165,000 305,000 a. What is the payback period for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) Payback period AZM Mini-SUV years AZF Full-SUV years b. What is the NPV for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) NPV AZM Mini-SUV $ AZF Full-SUV $ c. What is the IRR for each project? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) IRR AZM Mini-SUV % AZF Full-SUV %

Answer 1