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A company is considering Projects S and L, whose cash flows are shown below. These projects are mutually exclusive, equally risky, and are not repeatable.
A company is considering Projects S and L, whose cash flows are shown below. These projects are mutually exclusive, equally risky, and are not repeatable. If the decision is made by choosing the project with the higher IRR, how much value will be forgone? WACC: 1 3 6.25% 0 1 -$1,050 -$1,050 CFS CFL $675 $360 2 $650 $360 $360 $360
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