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Stalwork Enterprises is considering Projects Land M, whose cash flows are as follows: Project L cash flows will be -$1,025, $380, $380, $380, $380. Project
Stalwork Enterprises is considering Projects Land M, whose cash flows are as follows: Project L cash flows will be -$1,025, $380, $380, $380, $380. Project M cash flows will be $2,150, $765, $765, $765, $765. The CEO wants to use the IRR criterion, while the CFO favors the NPV method. You were hired to advise the firm on the best method and have calculated the appropriate cost of capital for evaluating both projects is 6.75% If the wrong decision criterion is used, how much potential value would the firm lose? A) $214.44 B) $186.47 C) $218.17 D) $182.74 E) $220.03
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