You are analyzing proposed projects and have compiled the following information: WACC...
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Finance
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You are analyzing proposed projects and have compiled the following information:
WACC (Required Return): 8.00%
Year
0
1
2
3
Project A CFs
-$1,250,000
$400,000
$500,000
$600,000
Project B CFs
-$1,250,000
$500,000
$500,000
$500,000
Compute the IRRs of these projects? Would the company accept one or both projects based on the IRR criterion?
Accept Project A only
Accept Project B only
Accept both Project A and Project B
Reject both Project A and Project B
You are analyzing proposed projects and have compiled the following information:
WACC (Required Return): 8.00%
| Year | 0 | 1 | 2 | 3 |
| Project A CFs | -$1,250,000 | $400,000 | $500,000 | $600,000 |
| Project B CFs | -$1,250,000 | $500,000 | $500,000 | $500,000 |
Compute the IRRs of these projects? Would the company accept one or both projects based on the IRR criterion?
| Accept Project A only | ||
| Accept Project B only | ||
| Accept both Project A and Project B | ||
| Reject both Project A and Project B |
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