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Project Alpha has an internal rate of return (IRR) of 15 percent. Project Beta has an IRR of 14 percent. Both projects have a required
Project Alpha has an internal rate of return (IRR) of 15 percent. Project Beta has an IRR of 14 percent. Both projects have a required return of 12 percent. Which of the following statements is MOST correct?
Both projects have a positive net present value (NPV). | ||
Project Alpha must have a higher NPV than Project Beta. | ||
Project Beta has a higher profitability index than Project Alpha. | ||
If the required return were less than 12 percent, Project Beta would have a higher IRR than Project Alpha. |
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