Question
A. If the IRR for a project is 15%, then the project's NPV would be: negative at a discount rate of 10%. positive at a
A. If the IRR for a project is 15%, then the project's NPV would be:
negative at a discount rate of 10%.
positive at a discount rate of 20%.
negative at a discount rate of 20%.
positive at a discount rate of 15%.
B.
Melody is considering the installation of solar panels for her house. Solar City quoted her a total cost of $22,000. She expects to save $3,500 per year in utility cost. Melody planned to sell her house and downsize after 15 years. If her opportunity cost of capital is 10%, should she install the solar panels?
Yes. NPV is $4,621
No. NPV is -$6,621
No. IRR is 13.54%
Yes. IRR is 9.8%
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Financial Management Theory and Practice
Authors: Eugene F. Brigham, Michael C. Ehrhardt
15th edition
130563229X, 978-1305632301, 1305632303, 978-0357685877, 978-1305886902, 1305886909, 978-1305632295
