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Piercy, LLC , has identified the following two mutually exclusive projects: Year Cash Flow ( A ) Cash Flow ( B ) 0 $ 5
Piercy, LLC has identified the following two mutually exclusive projects:
Year Cash Flow A Cash Flow B
$ $
a What is the IRR for each of these projects? Do not round intermediate calculations and enter your answers as a percent rounded to decimal places, eg
a If you apply the IRR decision rule, which project should the company accept?
b Assume the required return is percent. What is the NPV for each of these projects? Do not round intermediate calculations and round your answers to decimal places, eg
b Which project will you choose of you apply the NPV decision rule?
c Over what range of discount rates would you choose Project ADo not round intermediate calculations and enter your answer as a percent rounded to decimal places, eg
c Over what range of discount rates would you choose Project BDo not round intermediate calculations and enter your answer as a percent rounded to decimal places, eg
d At what discount rate would you be indifferent between these two projects? Do not round intermediate calculations and enter your answer as a percent rounded to decimal places, eg
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