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The ARN project requires initial investments of $255 Million and its NPV is $11 Million. The project has all positive cash flows and discount rate
The ARN project requires initial investments of $255 Million and its NPV is $11 Million.
The project has all positive cash flows and discount rate is above zero.
What is true?
I. The IRR of the project will increase if the required rate of return increases.
II. The NPV of the project may become negative if the discount rate willincreasesignificantly enough.
II only
I only
None of the above
I and II
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