Peanut Co.has 2 projects in which it can invest.Project X has a $300,000 initial cost and will return $600,000 before tax in year 2.Project Y has $600,000 initial cost and will return $1,000,000 before tax in year 4.The company uses an 8 percent discount rate for project evaluation and its marginal tax rate is expected to be 34 percent in all years.Which project(s)should Peanut Co.invest in?
a.Project X
b.Project Y
c.Both projects
d.Neither project

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The Answer of Peanut Co.has 2 projects in which it can invest.Project X has a $300,000 initial cost and will return $600,000 before tax in year 2.Project Y has $600,000 initial cost and will return $1,000,000 before tax in year 4.The company uses an 8 percent discount rate for project evaluation and its marginal tax rate is expected to be 34 percent in all years.Which project(s)should Peanut Co.invest in?
a.Project X
b.Project Y
c.Both projects
d.Neither project

Peanut CoHas 2 Projects in Which It Can Invest