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2) The following two questions are independent from each other. a) Your factory has been offered a contract that would last for 2 years, with

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2) The following two questions are independent from each other. a) Your factory has been offered a contract that would last for 2 years, with cash flows $6 million per year. Your upfront setup costs would be $10 million now. Show that the IRR is 13.07%. In addition, if your discount rate is 8%, do the IRR and NPV rules agree? b) You need to decide how to allocate space in your production faclity. You are considering the following 3 contracts: Contract A with NPV $7 million and 100% us of facility; Contract B with NPV $3 million and 50% use of facility, and Contract C wit NPV $2 million and 50% use of facility, what should you do

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