Drop Down: Accept/Reject

flows. Consider this case: Consider the following case: Blue Llama Mining Company is evaluating a proposed capital budgeting project (project Delta) that will require an initial investment of $1,500,000. Blue Llama Mining Company has been basing capital budgeting decisions on a project's NPV; however, its new CFO wants to start ing to compare to required returns. Blue Llama Mining Company's cost of capital is 9%, and project Delta has the same risk as the firm's average project. The project is expected to generate the following net cash flows: Which of the following is the correct calculation of project Delta's IRR? 313.65%295.20%3.69%405.90% If this is an independent project, the IRR method states that the firm should If the project's cost of capital were to increase, how would that affect the IRR? The IRR would not change. The IRR would increase. The IRR would not decrease