Question
Swenson's is considering two mutually exclusive projects, Projects A and B, and has determined that the crossover rate for these projects is 11.7 percent and
Swenson's is considering two mutually exclusive projects, Projects A and B, and has determined that the crossover rate for these projects is 11.7 percent and the required return for both projects is 9 percent. Given this you know that:
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neither project will be accepted if the discount rate is less than 11.7 percent.
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both projects have a negative NPV at discount rates greater than 11.7 percent.
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both projects provide an internal rate of return of 11.7 percent.
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both projects have a zero NPV at a discount rate of 11.7 percent.
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the project that is acceptable at a discount rate of 11 percent should be rejected at a discount rate of 12 percent.
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