The University of Johannesburg is considering whether to build a future-fit classroom that will allow live streams into the lecture or renovate library. Both these projects are mutually exclusive, and you have been asked to prepare a report that will help the Vice Chancellor make the decision. The Universitys weighted average cost of capital is 11% and required rate of return is 15% Future-Fit Classroom Library Renovations Capital investment R10 million R10 million Payback period 4.25 years 4.52 years Net present value X R1 836 520 Internal Rate of return 18.32% Y Assuming that the Internal Rate of Return of Library renovations is 16.02%, it means that... If the library renovations is higher than 16.02%, the University of Johannesburg will have a positive return from the renovations. If the WACC of library renovations is lower than 16.02%, the University of Johannesburg will have a positive return from the renovations. None of the above are correct. The university must choose to renovate the library as the IRR for the future-fit classroom is less than the renovations