2 3 4 -$1,100 -$2,750 $500 $700 $600 $725 $150 $850 $100 $1,400

Corporate Fin Focused Approach
5th Edition
ISBN:9781285660516
Author:EHRHARDT
Publisher:EHRHARDT
Chapter10: The Basics Of Capital Budgeting: Evaluating Cash Flows
Section: Chapter Questions
Problem 19P
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Noe Drilling Inc. is considering Projects S and L, whose cash flows are shown below. These projects
are mutually exclusive, equally risky, and not repeatable. Which project should be chosen based on
MIRR analysis?
WACC: 7.00%
Year
2
$600
$725
4
-$1,100
-$2,750
$500
$700
$150
$850
$100
$1,400
CFs
CF
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Transcribed Image Text:Noe Drilling Inc. is considering Projects S and L, whose cash flows are shown below. These projects are mutually exclusive, equally risky, and not repeatable. Which project should be chosen based on MIRR analysis? WACC: 7.00% Year 2 $600 $725 4 -$1,100 -$2,750 $500 $700 $150 $850 $100 $1,400 CFs CF Upload Choose a File
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