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 $868.48
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 | $868.48 | $260 | $5 | $10 |
| Project L | -$1,000 | $0 | $250 | $420 | $834.26 |
The company's WACC is 9.0%. 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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Fundamentals Of Corporate Finance
Authors: David W Blackwell, Robert Parrino, David S Kidwell
1st Edition
0471270563, 9780471270560
