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Year 0 1 2 3 4 Project 1 -$148 $18 $40 $59 $80 Project 2 -824 0 0 7009 -6504 Project 3 18 39 60
Year | 0 | 1 | 2 | 3 | 4 |
Project 1 | -$148 | $18 | $40 | $59 | $80 |
Project 2 | -824 | 0 | 0 | 7009 | -6504 |
Project 3 | 18 | 39 | 60 | 82 | -243 |
a. For which of these projects is the IRR rule reliable?
b. Estimate the IRR for each project (to the nearest 1%).
c. What is the NPV of each project if the cost of capital is
5%?
20%?
50%?
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