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Consider two mutually exclusive projects A and B: Cash Flows (dollars) Project A Co -31,000 B -51,000 C NPV at 12% 21,800 34,000 21,800
Consider two mutually exclusive projects A and B: Cash Flows (dollars) Project A Co -31,000 B -51,000 C NPV at 12% 21,800 34,000 21,800 34,000 +$ 5,843 +6,462 a. Calculate IRRs for A and B. Note: Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places. Project IRR A B % % b. Which project does the IRR rule suggest is best? O Project A O Project B
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International Financial Management
Authors: Geert Bekaert, Robert J. Hodrick
2nd edition
013299755X, 132162768, 9780132997553, 978-0132162760
