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Its all one question broken into multiple parts. Bruin, Incorporated, has identified the following two mutually exclusive projects: Year ONM 1 2. 3 4. Cash
Its all one question broken into multiple parts.
Bruin, Incorporated, has identified the following two mutually exclusive projects: Year ONM 1 2. 3 4. Cash Flow (A) -$ 41,300 19,100 17,800 15,200 8.400 Cash Flow (B) -$ 41,300 6,300 14,200 17,900 30,300 a-1. What is the IRR for each of these projects? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) IRR Project A Project B % % a-2. Using the IRR decision rule, which project should the company accept? Project A O Project B a-3. Is this decision necessarily correct? Yes No b-1. If the required return is 11 percent, what is the NPV for each of these projects? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) NPV Project A Project B b-2. Which project will the company choose if it applies the NPV decision rule? O Project A O Project B c. At what discount rate would the company be indifferent between these two projects? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Discount rate % Step by Step Solution
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