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SJ Inc is considering the following 2 projects. SJ's WACC is 12%. What is the cross over rate of the projects? project Initial cost (t=0)
SJ Inc is considering the following 2 projects. SJ's WACC is 12%. What is the cross over rate of the projects?
project | Initial cost (t=0) | Yr 1 Cash Flow | Yr 2 Cash Flow | Yr 3 Cash Flow |
AIN | -90 | 10 | 40 | 90 |
DIN | -100 | 60 | 55 | 20 |
19.46% | ||
17.55% | ||
17.02% | ||
13.33% |
QUESTION 19
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Jan Corp is considering the following projects:
Project
NPV
IRR
MMx2 - $.5 million
15.93%
xxLL3 $2.1 million
14.02%
Assuming that Projects MMx2 and xxLL3 are independent what would be the correct decision if Jan Corp's WACC is 14%?
Project MMx2.
Project xxLL3.
Neither Project.
Both Projects.
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