Question
6. Home Grown Caf has the following two projects with their cash flows below: Year Project 1 CFs Project 2 CFs 0 -$41,600 -$30000 1
6. Home Grown Caf has the following two projects with their cash flows below:
| Year | Project 1 CFs | Project 2 CFs |
| 0 | -$41,600 | -$30000 |
| 1 | 16000 | 6000 |
| 2 | 13000 | 11000 |
| 3 | 18000 | 12000 |
| 4 | 15000 | 19000 |
Calculate the IRR (to the closest whole number) for these mutually exclusive projects and decide which one should be accepted if the required rate of return (cost of capital) is 11%. Explain your reasoning based on the NPV.
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Unlock Financial Success With Self Storage Wealth Strategies
Authors: Ethan D. Costa
1st Edition
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