Question
IRR AND NPV A company is analyzing two mutually exclusive projects, S and L, with the following cash flows: 0 1 2 3 4 Project
IRR AND NPV
A company is analyzing two mutually exclusive projects, S and L, with the following cash flows:
| 0 | 1 | 2 | 3 | 4 |
| Project S | -$1,000 | $889.82 | $240 | $5 | $15 |
| Project L | -$1,000 | $5 | $260 | $420 | $742.62 |
The company's WACC is 10.5%. What is the IRR of the better project? (Hint: The better project may or may not be the one with the higher IRR.) Round your answer to two decimal places.
_____%
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Essentials Of Investments
Authors: Zvi Bodie, Alex Kane, Alan J. Marcus
8th Edition
0077606779, 978-0697789945
