Question: Given the following cash flows for project A and project B: Year O 2 3 4 Project A -15000 4000 Project B -17000 5000 2000

Given the following cash flows for project A and project B:

Year

Project A

-15000

4000

Project B

-17000

5000

2000

7000

2000

7000

5000

6250

Which of the following statement is correct?

O a.

The crossover rate of the two projects is 7.0%

O b. The crossover rate of the two projects is the mean of the IRRs of the two projects

O c. The crossover rate of the two projects is higher than the IRR of the project with the lowest IRR of

both projects.

O d.

The crossover rate of the two projects is 4.6%.

O e. The crossover rate of the two projects is 6.8%

Marks the project with the lowest IRR of Given the following cash flows for project A and project B: Year 0 1 2 3 Project A -15000 4000 2000 7000 5000 5000 2000 7000 6250 Project B -17000 Which of the following statement is correct? O a. The crossover rate of the two projects is 7.0% O b. The crossover rate of the two projects is the mean of the IRRS of the two projects Oc. The crossover rate of the two projects is higher than the IRR both projects. O d. The crossover rate of the two projects is 4.6%. O e. The crossover rate of the two projects is 6.8%

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