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Explore BrainMass

NPV vs. IRR; Cost-plus pricing vs. target costing

Explain cost-plus pricing and give an example that shows how prices would be determined using this method. How does it differ from target costing

Suppose a company has 5 different capital budgeting projects from which to choose, but has constrained funds and cannot implement all of the projects. Explain why comparing the projects' NPVs is better than comparing their IRRs.