Question
A company is analyzing two mutually exclusive projects, S and L, with the following cash flows: 0 1 2 3 4 Project S -$1,000 $874.41
A company is analyzing two mutually exclusive projects, S and L, with the following cash flows:
| 0 | 1 | 2 | 3 | 4 |
| Project S | -$1,000 | $874.41 | $250 | $10 | $15 |
| Project L | -$1,000 | $0 | $240 | $420 | $792.77 |
The company's WACC is 10.0%. What is the IRR of the better project? (Hint: The better project may or may not be the one with the higher IRR.) Round your answer to two decimal places.
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Short Term Financial Management
Authors: Terry S. Maness, John T. Zietlow
3rd Edition
0324202938, 978-0324202939
