IRR and NPVs
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A company is analyzing two mutually exclusive projects, S and L, with
the following cash flows:
0 1 2 3 4
Project S $1,000 $900 250 10 10
Project L $1,000 0 250 400 800
The company's WACC is 10 percent. What is the IRR of the better project? (Hint: Note
that the better project may or may not be the one with the higher IRR.)
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Solution Summary
A company is analyzing two mutually exclusive projects, S and L, with
the following cash flows:
Solution Preview
See the attached excel for calculations
WACC 10%
Project ...
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