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 $903.60
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 | $903.60 | $240 | $5 | $5 |
| Project L | -$1,000 | $10 | $250 | $400 | $755.96 |
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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Introductory Econometrics For Finance
Authors: Chris Brooks
2nd Edition
052169468X, 9780521694681
