Question
There are two mutually exclusive projects. The hurdle rate (discount rate) is 14%. A project A requires $100000 today and returning $115000 in one year.
There are two mutually exclusive projects. The hurdle rate (discount rate) is 14%. A project A requires $100000 today and returning $115000 in one year. A project B requires $1000000 today returning $1150000 in one year. Project A: IRR = 15% Project B IRR = 15%. How would you decide which project to choose? Prove your answer with the necessary computations.
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Fundamentals of Financial Accounting
Authors: Fred Phillips, Robert Libby, Patricia Libby
5th edition
978-0078025914
