John’s Gyms is choosing between two new offerings, a Playhouse and a Fort-The Playhouse line will cost $30,000 to set up and generate cash flows of $15,000 and $20,000 over two years. -The Fort project will cost $80,000 to set up but is expected to yield cash flows of $39,000 and $52,000. a. What is the cross-over rate for the Fort and Playhouse projects?
John’s Gyms is choosing between two new offerings, a Playhouse and a Fort-The Playhouse line will cost $30,000 to set up and generate cash flows of $15,000 and $20,000 over two years. -The Fort project will cost $80,000 to set up but is expected to yield cash flows of $39,000 and $52,000. a. What is the cross-over rate for the Fort and Playhouse projects?
Chapter11: Capital Budgeting Decisions
Section: Chapter Questions
Problem 6PA: There are two projects under consideration by the Rainbow factory. Each of the projects will require...
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John’s Gyms is choosing between two new offerings, a Playhouse and a Fort-The Playhouse line will cost $30,000 to set up and generate cash flows of $15,000 and $20,000 over two years.
-The Fort project will cost $80,000 to set up but is expected to yield cash flows of $39,000 and $52,000.
a. What is the cross-over rate for the Fort and Playhouse projects?
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