Question
Werqo Corp is considering two mutually exclusive projects, Projects A and B, and has determined that the crossover rate for these projects is 13.9 percent
Werqo Corp is considering two mutually exclusive projects, Projects A and B, and has determined that the crossover rate for these projects is 13.9 percent and the required return for both projects is 5.2 percent. You have determined that you should accept project A if the required return is 14.3 percent. Given this you know that:
Project B provides an internal rate of return of 13.9 percent. | ||
always accept Project B. | ||
the project that is acceptable at a discount rate of 13.6 percent should be rejected at a discount rate of 14.2 percent. | ||
Project B has a zero NPV at a discount rate of 13.9 percent. | ||
both projects provide an internal rate of return of 13.9 percent. |
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