A company is analyzing two mutually exclusive projects, S and L, with the following cash flows: ° 1 2 3 4 + + + Project S Project L -$1,000 $877.01 -$1,000 $5 $260 $240 $5 $400 $5 $799.36 The company's WACC is 10.0%. What is the IRR of the better project? (Hint: The better project may or may not be the one with the higher IRR.) Round your answer to two decimal places. %

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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A company is analyzing two mutually exclusive projects, S and L, with the following cash flows:
°
1
2
3
4
+
+
+
Project S
Project L
-$1,000 $877.01
-$1,000
$5
$260
$240
$5
$400
$5
$799.36
The company's WACC is 10.0%. What is the IRR of the better project? (Hint: The better project may or may not be the one with the higher IRR.) Round your answer to two decimal
places.
%
Transcribed Image Text:A company is analyzing two mutually exclusive projects, S and L, with the following cash flows: ° 1 2 3 4 + + + Project S Project L -$1,000 $877.01 -$1,000 $5 $260 $240 $5 $400 $5 $799.36 The company's WACC is 10.0%. What is the IRR of the better project? (Hint: The better project may or may not be the one with the higher IRR.) Round your answer to two decimal places. %
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