a) Compute the present value factor and the IRR for the two projects. Please make sure your final answers for the present value factor are accurate to 3 decimal places and the ones for the IRR are accurate to the nearest whole percent. Project Present value factor IRR A B b) Which project would Ingersoll Antiques most likely invest in? O Project A O Project B ONeither
a) Compute the present value factor and the IRR for the two projects. Please make sure your final answers for the present value factor are accurate to 3 decimal places and the ones for the IRR are accurate to the nearest whole percent. Project Present value factor IRR A B b) Which project would Ingersoll Antiques most likely invest in? O Project A O Project B ONeither
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Ingersoll Antiques is considering two projects. Their required rate of return is 10%.
Project
Initial investment cost
Annual cash flows
Life of the project
A
B
$160,000 $170,000
$56,557 $47,157
3 years 5 years
a) Compute the present value factor and the IRR for the two projects.
Please make sure your final answers for the present value factor are accurate to 3 decimal places and the ones for the IRR are accurate to the nearest whole percent.
Project Present value factor IRR
A
B
b) Which project would Ingersoll Antiques most likely invest in?
O Project A
O Project B
O Neither
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