Question: please show work Project A has a five-year life and an initial cost of $2,000 and annual cash flows of $700 per year. Project B
Project A has a five-year life and an initial cost of $2,000 and annual cash flows of $700 per year. Project B also has a five-year life and an initial cost of $3,000 with annual cash flows of $950 per year. Given this information: i. Calculate the IRR cross-over rate ii. Calculate the corresponding NPV that the cross-over rate provides. iii. Interpret the cross-over rate in terms of acceptance/rejection of projects A and B. Which project is accepted for required rates lower (higher) than the cross-over rate? Why
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