Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Quantitative Problem: Bellinger Industries is considering two projects for inclusion in its capital budget, and you hav
do the analysis. Both projects' after-tax cash flows are shown on the time line below. Depreciation, salvage values, net
working capital requirements, and tax effects are all included in these cash flows. Both projects have 4-year lives, and
characteristics similar to the firm's average project. Bellinger's WACC is 8%.
0
Project A
-1,500
Project B -1,500
1
700
300
2
370
310
3
215
395
4
310
755
What is Project Delta's IRR? Do not round intermediate calculations. Round your answer to two decimal places.
*%
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Transcribed Image Text:Quantitative Problem: Bellinger Industries is considering two projects for inclusion in its capital budget, and you hav do the analysis. Both projects' after-tax cash flows are shown on the time line below. Depreciation, salvage values, net working capital requirements, and tax effects are all included in these cash flows. Both projects have 4-year lives, and characteristics similar to the firm's average project. Bellinger's WACC is 8%. 0 Project A -1,500 Project B -1,500 1 700 300 2 370 310 3 215 395 4 310 755 What is Project Delta's IRR? Do not round intermediate calculations. Round your answer to two decimal places. *%
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