Question: Solve the problem. Do not solve only point a but also try to solve b and c You have 3 projects with the following cash
Solve the problem. Do not solve only point a but also try to solve b and c
You have 3 projects with the following cash flows: (Click on the following icon in order to copy its contents into a spreadsheet.) 4 2 $42 Year Project 1 Project 2 Project 3 0 - $148 - 824 20 1 $19 0 38 3 $61 6,991 80 $82 -6,498 - 244 59 a. For which of these projects is the IRR rule reliable? b. Estimate the IRR for each project (to the nearest 1%). c. What is the NPV of each project if the cost of capital is 5%? 20%? 50%? .. a. For which of these projects is the IRR rule reliable? (Select from the drop-down menus.) The IRR rule is reliable for Unless all of the cash flows of the project precede the ones, the IRR rule may give the wrong answer and should not be used. Furthermore, there may be multiple IRRs or the IRR may not exist
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