Question: Suppose the Far North Airlines has two projects: Setting up a hub in Far East, and Setting up a hub in Far West. Project East

Suppose the Far North Airlines has two projects: Setting up a hub in Far East, and Setting up a hub in Far West. Project East has an IRR of 12 percent and project West has an IRR of 15 percent. The crossover rate is 9 percent. The projects' appropriate discount rate is 11 percent. Which project(s) Far North should pick?

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