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Jones Corporation is attempting to choose the better of 2 mutually exclusive projects for expanding the firm's warehouse capacity. The firm's cost of...

Jones Corporation is attempting to choose the better of 2 mutually exclusive projects for expanding the firm’s warehouse capacity. The firm’s cost of capital is 15%. Calculate each project’s payback period, net present value (NPV), and its internal rate of return (IRR)?
L M
Initial Investment $500,000 $325,000
Year cash inflows
1 $100,000 $140,000
2 $120,000 $120,000
3 $150,000 $95,000
4 $190,000 $70,000
5 $250,000 $50,000

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547646_FIN.xls

L
M
r
PV 0
-500,000
-325,000 1
100,000
140,000 2
120,000
120,000 3
150,000
95,000 4
190,000
70,000 5
250,000
50,000 0.870 0.756 0.658 0.572 0.497 15% Payback
4 years
3 years NPV
9,248
14,822 IRR...

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