Question
consider two investment projects, which both require an upfront investment of $11 million and both of which pay a constant amount each year for the
consider two investment projects, which both require an upfront investment of $11 million and both of which pay a constant amount each year for the next 9 years. Under what conditions can you rank these projects by comparing their IRRs?
A. There are no conditions under which you can use the IRR to rank projects.
B. Ranking by IRR will work in this case so long as the projects' have the same risk.
C. Ranking by IRR will work in this case so long as the projects' cash flows do not decrease from year to year.
D. Ranking by IRR will work in this case so long as the projects' cash flows do not increase from year to year
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Handbook Of Research Methods And Applications In Empirical Finance
Authors: Adrian R. Bell, Chris Brooks, Marcel Prokopczuk
1st Edition
1782540172, 978-1782540175
