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
Related questions
Question
Calculate by using formula [NOT EXCEL]
Transcribed Image Text:A company is analyzing two mutually exclusive projects, S and L, whose cash flows
are shown below:
Years
1
3
4
S -1,100
900
350
50
10
L -1,100
300
500
850
The company's cost of capital is 12 percent, and it can get an unlimited amount of
capital at that cost. What is the NPV and regular IRR (not MIRR) of the projects?
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