Question
An investment project has the following cash flows: CF0 = -1,000,000; CF1 CF8 = 200,000 each. If the required rate of return is 12%: a.
An investment project has the following cash flows: CF0 = -1,000,000; CF1 CF8 = 200,000 each. If the required rate of return is 12%:
a. What decision should be made using NPV? (5%)
b. How would the IRR decision rule be used for this project? What decision would be reached? (10%)
c. How are the above two decisions related? (10%)
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Glencoe Business And Personal Finance
Authors: McGraw-Hill
1st Edition
0021400202, 9780021400201
