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Projects X and Y require an initial investment of $ 7 5 , 0 0 0 and $ 1 0 5 , 0 0 0

Projects X and Y require an initial investment of $

75, 000

and $

105, 000,

respectively. The projects are mutually exclusive, and you know the smaller project has a positive NPV

.

Of the following methods, which one is considered to be the best method to determine which project to accept?

Discounted payback

Modified IRR

Average accounting rate of return

Incremental IRR

IRR

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