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You examine the cash flows for 4 mutually exclusive projects below. According to the Modified IRR Rule, which project should you accept? Year A B
You examine the cash flows for 4 mutually exclusive projects below. According to the Modified IRR Rule, which project should you accept?
| Year | A | B | C | D |
| 0 | -500 | -700 | -900 | -1100 |
| 1 | 100 | 75 | 400 | 300 |
| 2 | 150 | 150 | 150 | 300 |
| 3 | 250 | 400 | 300 | 350 |
| 4 | 200 | 350 | 350 | 450 |
| 5 | 75 | 100 | 100 | 150 |
| Cost of Capital | 7.0% | 6.5% | 9.5% | 7.5% |
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Authors: Sharon Coleman
1st Edition
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