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A firm utilizes a strategy of capital rationing, which is currently $375,000 and is considering the following two projects: Project A has a cost of
A firm utilizes a strategy of capital rationing, which is currently $375,000 and is considering the following two projects: Project A has a cost of $335.000 and the following cash flows year 15140,000 year 2 $150.000 and year 3 $100.000. Project B has a cost of $365,000 and the following cash flows: year 1$220,000; year 2 $110,000; and year 3 $150,000. Using a 6% cost of capital, what is the internal rate of return of projects 8 Multiple Choice Higher than 6% O Can not be determined from the given information Exactly 6% Lower than 6%
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