Piercy, LLC, has identified the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 -$56,000 -$56000 1 32,000 19,400 2 26,000 23,400 3 19,000 28,000 4 13,200 25,400 Over what range of Discount rates would you choose Project A? Project B? (Please list percentages rounded to 2 decimal places. Hint: The answer is not the same as the IRR.) Project A ____________% Project B ____________% At what discount rate would you be indifferent between these two projects? ____________%
Piercy, LLC, has identified the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 -$56,000 -$56000 1 32,000 19,400 2 26,000 23,400 3 19,000 28,000 4 13,200 25,400 Over what range of Discount rates would you choose Project A? Project B? (Please list percentages rounded to 2 decimal places. Hint: The answer is not the same as the IRR.) Project A ____________% Project B ____________% At what discount rate would you be indifferent between these two projects? ____________%
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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Piercy, LLC, has identified the following two mutually exclusive projects:
Year | Cash Flow (A) | Cash Flow (B) |
0 |
-$56,000 | -$56000 |
1 | 32,000 | 19,400 |
2 | 26,000 | 23,400 |
3 | 19,000 | 28,000 |
4 | 13,200 | 25,400 |
Over what range of Discount rates would you choose Project A? Project B?
(Please list percentages rounded to 2 decimal places. Hint: The answer is not the same as the
Project A ____________%
Project B ____________%
At what discount rate would you be indifferent between these two projects? ____________%
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