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VWX Ltd is considering two potential investments. The company's cost of capital is 11% and the tax rate is 31%. Details are provided below: Particulars
- VWX Ltd is considering two potential investments. The company's cost of capital is 11% and the tax rate is 31%. Details are provided below:
Particulars | Investment 1 | Investment 2 |
Cost of investment | 21,00,000 | 24,00,000 |
Expected life | 6 years | 6 years |
Annual Income (before Tax & Depreciation) | 6,75,000 | 8,00,000 |
- Depreciation is charged on a straight-line basis. You are required to calculate: a. Internal Rate of Return (IRR) b. NPV c. Payback period
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Calculus
Authors: Ron Larson, Bruce H. Edwards
10th Edition
1285057090, 978-1285057095
