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What is Project A's Modified Internal Rate of Return with a WACC of 6.75%? YEAR                   CASH...

What is Project A's Modified Internal Rate of Return with a WACC of 6.75%?

YEAR                   CASH FLOWS

                        Project A         Project B

0                    -$1050           -$1050

1                        675                  360

2                        650                  360

3                                                 360

4                                                 360

0 0
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Answer #1

Project A's Modified Internal Rate of Return

=((675*(1+6.75%)^1+650)/1050)^(1/2)-1

=14.25%

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