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5. NPV profiles An NPV profile plots a project's NPV at various costs of capital, labeled A and B' in the graph. A project's NPV

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5. NPV profiles An NPV profile plots a project's NPV at various costs of capital, labeled "A" and "B' in the graph. A project's NPV profile is shown as follows. Identify the range of costs (ranges labeled "A" and "B") of capital that a firm would use to accept and reject this project. a NPV Dollars 400 300 200 . 100 B -100 200 26 8 10 12 14 16 18 20 COST OF CAPITAL (Percent A 100 0 B - 100 -200 0 2 4 6 8 10 12 14 16 18 20 COST OF CAPITAL (Percent) A B True or False: The NPV and IRR methods can lead to conflicting decisions for mutually exclusive projects. False True Grade It NO D BE a

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