Consider the following two investment projects and an MARR of 9%. Remember that Excel may not be
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Question:
Consider the following two investment projects and an MARR of 9%. Remember that Excel may not be used for any part of this question.
(a) Classify each investment as either a simple or non-simple.
(b) Find all possible i* values for each project
(c) Use the RIC method to find the true IRR for Project A
(d) What can be said about the true IRR for Project B, based upon the results of parts (a) and (b) [do not perform any calculations to answer this question]
(e) Consider each individual project and determine if these projects (when considered individually) are good or bad investments. Use an MIRR approach.
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