Question
Godfall Inc. is evaluating two mutually exclusive projects. The required rate of return on these projects is 6%. Calculate the incremental IRR (aka cross-over rate)
Godfall Inc. is evaluating two mutually exclusive projects. The required rate of return on these projects is 6%. Calculate the incremental IRR (aka cross-over rate) for the two projects. (Enter percentages as decimals and round to 4 decimals).
| Year | Project A | Project B |
| 0 | -8,000,000 | -3,250,000 |
| 1 | 2,000,000 | 850,000 |
| 2 | 2,000,000 | 850,000 |
| 3 | 2,000,000 | 850,000 |
| 4 | 2,000,000 | 850,000 |
| 5 | 2,000,000 | 850,000 |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Finance Basics 20 Minute Manager
Authors: Harvard Business Review
1st Edition
1625270852, 978-1625270856
