Investment A has a 8.25% internal rate of return and Investment B has a 10.0% internal...
Investment A has a 8.25% internal rate of return and Investment B has a 10.0% internal rate of return. The two investments are mutually exclusive. If the required return is 6.50%, which of the following is a true statement?
Group of answer choices Investment
A should be chosen over Investment B
Both Investment A and Investment B should be chosen.
Investment B should be chosen over Investment A.
It is not possible to know which of the two investments is best with the given information.
Homework Answers
The investments are mutually exclusive, only one of them can be chosen. The one with a higher IRR and also above required rate is to be chosen, thus the answer is:-
Investment B should be chosen over Investment A.
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please show work
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Dropdown options first 2 blanks: (internal rate of return IRR,
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Dropdown options 3rd blank: (NPV method, IRR method)
If projects are mutually exclusive, only one project can be chosen. The internal rate of return (IRR) and the net present value (NPV) methods will not always choose the same project. If the crossover rate on the NPV profile is below the horizontal axis, the methods will agree. always Projects Y and...
please show work
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2. Internal rate of return (IRR) Aa Aa E The internal rate of return (IRR) refers to the compound annual rate of return that a project generates based on its up-front cost and subsequent cash flows. Consider the case of Pellegrini Southern Inc.: Pellegrini Southern Inc. is evaluating a proposed capital budgeting project (project Sigma) that will require an initial investment of $800,000. Pellegrini Southern Inc. has been basing capital budgeting decisions on a project's NPV; however, its new CFO...
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What is the NPV?
r=9.28
c1= 5.853
c2= 6.37 + 1,826.76
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