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    Correct statement

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    A project has an up-front cash outflow of $100,000. The project's WACC is 12 percent and its net present value is $10,000. Which of the following statements is most correct?

    The project should be rejected since its return is less than the WACC.

    The project s internal rate of return is greater than 12 percent.

    The project s modified internal rate of return is less than 12 percent.

    All of the above answers are correct.

    None of the above answers is correct.

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    Solution Preview

    The project should be rejected since its return is less than the WACC.

    This is not correct. Since the NPV is postive, the IRR ...

    Solution Summary

    The solution explains the correct statement from among the given alternatives

    $2.19

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