Should the firm accept the independent projects described below Why or why not a The firms cost of capital is 10 percent and the estimated internal rate of return (IRR) of the project is 11 percent b A capital investment requires a $150,000 initial investment The firms cost of capital is 10 percent...

a The firm can expect to earn a higher return than t ...

Should the firm accept the independent projects described below? Why or why not? a. The firms cost

Question:

Should the firm accept the independent projects described below? Why or why not?
a. The firm’s is 10 percent and the estimated (IRR) of the project is 11 percent.
b. A capital investment requires a $150,000 initial investment. The firm’s is 10 percent, and the present value of the expected cash inflows from the project is $148,000.

Internal Rate of Return
Internal Rate of Return of IRR is a capital budgeting tool that is used to assess the viability of an investment opportunity. IRR is the true rate of return that a project is capable of generating. It is a metric that tells you about the investment... Cost Of Capital
Cost of capital refers to the opportunity cost of making a specific investment . Cost of capital (COC) is the rate of return that a firm must earn on its project investments to maintain its market value and attract funds. COC is the required rate of...