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 $867.90
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 | $867.90 | $250 | $15 | $15 |
| Project L | -$1,000 | $10 | $250 | $420 | $743.61 |
The company's WACC is 8.0%. 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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An Introduction To Derivatives And Risk Management
Authors: Don M. Chance, Roberts Brooks
7th Edition
0324321392, 9780324321395
