A firm with a WACC of 10% is considering the following mutually exclusive projects: 0 1 2 3 4 5 Project 1 -$400 $60 $60 $60 $230 $230 Project 2 -$450 $350 $350 $115 $115 $115 Which project would you recommend? Select the correct answer. Oa. Both Projects 1 and 2, since both projects have IRR's > 0. Ob. Project 1, since the NPV1 > NPV2. Oc. Project 2, since the NPV2 > NPV1. Od. Neither Project 1 nor 2, since each project's NPV < 0. Oe. Both Projects 1 and 2, since both projects have NPV's > 0.
A firm with a WACC of 10% is considering the following mutually exclusive projects: 0 1 2 3 4 5 Project 1 -$400 $60 $60 $60 $230 $230 Project 2 -$450 $350 $350 $115 $115 $115 Which project would you recommend? Select the correct answer. Oa. Both Projects 1 and 2, since both projects have IRR's > 0. Ob. Project 1, since the NPV1 > NPV2. Oc. Project 2, since the NPV2 > NPV1. Od. Neither Project 1 nor 2, since each project's NPV < 0. Oe. Both Projects 1 and 2, since both projects have NPV's > 0.
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
Question
5.
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Project L requires an initial outlay at t = 0 of $55,000, its expected years |
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