Question
Consider two mutually exclusive projects A and B: Cash Flows (dollars) Project C0 C1 C2 NPV at 11% A 36,500 26,200 26,200 +$8,368 B 56,500
Consider two mutually exclusive projects A and B: Cash Flows (dollars) Project C0 C1 C2 NPV at 11% A 36,500 26,200 26,200 +$8,368 B 56,500 39,500 39,500 +11,145 a. Calculate IRRs for A and B. (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) b. Which project does the IRR rule suggest is best? Project A Project B c. Which project is really best?
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Small Business Management Launching and Growing New Ventures
Authors: Justin Longenecker, Leo Donlevy, Terri Champion, William Petty, Leslie Palich, Frank Hoy
6th Canadian edition
176532218, 978-0176532215
