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Two mutually exclusive projects, A and B, have NPV of $2.5m and $2.9m respectively. However, Project A's IRR is greater than Project B's IRR. The
Two mutually exclusive projects, A and B, have NPV of $2.5m and $2.9m respectively. However, Project A's IRR is greater than Project B's IRR. The cross-over rate for the projects' NPV profiles is 12%. Which of the following statements is true?
| A. The projects' cost of capital is greater than 12% | ||
| B. The projects' cost of capital is less than 12% | ||
| C. The projects' cost of capital is equal to 12% | ||
| D. Insufficient information to make any determination |
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