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If an independent project with conventional, or normal, cash flows is being analyzed, the net present value (NPV) and internal rate of return (IRR) methods
If an independent project with conventional, or normal, cash flows is being analyzed, the net present value (NPV) and internal rate of return (IRR) methods agree. always never sometimes Projects Y and Z are mutually exclusive p h flows and NPV profiles are shown as follows NPV (Dollars) Year Project Y Project Z $1,500-$1,500 $900 $600 $300 $200 800 0 $200 $400 $600 $1,000 600 Project Y 3 400 4 Project Z 200 If the weighted average cost of capital (WACC) for each project is 2%, do the NPV and IRR methods agree or conflict? -200 0 2 4 6 810 12 14 16 18 20 O The methods agree. O The methods conflict. COST OF CAPITAL (Percent
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