Question: Consider the three projects A, B, and C. The cost of capital is 12 percent, and the projects have the following expected cash flows: a.

Consider the three projects A, B, and C. The cost of capital is 12 percent, and the projects have the following expected cash flows:

a. What is the internal rate of return of the three projects?
b. What is the net present value of the three projects?
c. If the three projects are independent, which projects should be accepted?
d. If the three projects are mutually exclusive, which project should be selected?
e. If the total budget for the three projects is limited to $450,000, which projects should be selected?

Project A Project B Project C Now End-of-Year 1 End-of-Year 2 -$150,000 120,000 80,000 -$300,000 200,000 180,000 -$150,000 110,000 90,000

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