Bausch Company is presented with the following two mutually exclusive projects. The required return for both projects is 18 percent Project M -$137,000 64,800 82,800 73,800 59,800 Year Project N -$368,000 146,000 193,000 131,000 123,000 a. What is the IRR for each project? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g.., 32.16.) b. What is the NPV for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) c. Which, if either, of the projects should the company accept? Project M Project N b. Project M a. Project N c. Accept project 11234

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
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5. Find the answer to AB and C
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Bausch Company is presented with the following two mutually exclusive projects. The
required return for both projects is 18 percent.
Project M
$137,000
64,800
82,800
Project N
-$368,000
Year
0.
146,000
193,000
131,000
123,000
2.
73,800
59,800
a. What is the IRR for each project? (Do not round intermediate calculations and enter
your answers as a percent rounded to 2 decimal places, e.g., 32.16.)
b. What is the NPV for each project? (Do not round intermediate calculations and
round your answers to 2 decimal places, e.g., 32.16.)
c. Which, if either, of the projects should the company accept?
Project M
a.
Project N
b. Project M
%
Project N
c. Accept project
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Transcribed Image Text:Saved Bausch Company is presented with the following two mutually exclusive projects. The required return for both projects is 18 percent. Project M $137,000 64,800 82,800 Project N -$368,000 Year 0. 146,000 193,000 131,000 123,000 2. 73,800 59,800 a. What is the IRR for each project? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) b. What is the NPV for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) c. Which, if either, of the projects should the company accept? Project M a. Project N b. Project M % Project N c. Accept project < Prev 5 of 6 ere to search
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