Discount all negative cash flow to t0 add to initial

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Example 8: What is the MIRR for the project given in Example 6? The required return is 15%.
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3. Combination Approach (MIRR = 15.36%)Capital Budgeting Decision Criteria ComparisonTechnique Units Accept if: PaybackTimePayback < Mgt’s #Discounted PaybackTimePayback < Mgt’s #Net Present Value$NPV > $0Profitability Index (PI)NonePI > 1.0Internal Rate of Return%IRR > RModified Internal Rate of Return (MIRR)%IRR > RVII. Capital Budgeting in PracticeEthics Issues I:ABC poll in the spring of 2004 found that one-third of students age 12 – 17 admitted to cheating and the percentage increased as the students got older and felt more grade pressure. If a book entitled “How to Cheat: A User’s Guide” would generate a positive NPV, would it be proper for a publishing company to offer the new book?Ethics Issues II:Should a firm exceed the minimum legal limits of government imposed environmental regulations and be responsible for the environment, even if this responsibility leads to a wealth reduction for the firm? Is environmental damage merely a cost of doing business?17
Example 9: Your firm is considering investing in one of two mutually exclusive projects. Youwere asked to evaluate the two projects and select the one that will be more profitable for thefirm. The projects have equivalent risk and the appropriate discount rate is 14%. The expectedfuture cash flows have already been computed, they are as follows:YearProject AProject B0-100-1501304524060350754406053060Which project would you select based on:
Based on your answers above, which project would you recommend to your firm?Example 10: Real Estate Solutions, Inc., has identified the following two mutually exclusive projects:YearCash Flow (A)Cash Flow (B)0-12,500-12,00014,0001,00025,0006,00036,0005,00041,0004,00018

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