Question
A company is analyzing two mutually exclusive projects, S and L, whose cash flows are shown below: 0 1 2 3 4 S -1,000 900
A company is analyzing two mutually exclusive projects, S and L, whose cash flows are shown below:
| 0 | 1 | 2 | 3 | 4 | |
| S | -1,000 | 900 | 250 | 10 | 10 |
| L | -1,000 | 0 | 250 | 400 | 800 |
a. What is the IRR of both projects?
b. Which project would you accept?
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Auditing Cases An Active Learning Approach
Authors: Mark S. Beasley, Frank A. Buckless, Steven M. Glover, Douglas F. Prawitt
2nd Edition
0130674842, 978-0130674845
