Question
Cutler Petroleum, Inc., is trying to evaluate a generation project with the following cash flows: Year Cash Flow 0 $ 85,000,000 1 125,000,000 2 15,000,000
Cutler Petroleum, Inc., is trying to evaluate a generation project with the following cash flows:
Year Cash Flow 0 $ 85,000,000 1 125,000,000 2 15,000,000
A. If the company requires a 10% return on its investment should it accept this project? Why?
b.Compare the project IRR for this project. How many IRRs are there? If you should apply the IRR division rule. Should you accept the project or not.? What's going on here?
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Financial Markets And Institutions
Authors: Frederic S. Mishkin, Stanley G. Eakin
7th Global Edition
0273754440, 9780273754442
