Question: when two mutually exclusive projects are being compared, explain why the short - term project might be ranked higher under the NPV criterion if the

when two mutually exclusive projects are being compared, explain why the short

-

term project might be ranked higher under the NPV criterion if the cost of capital is high, whereas the long

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term project might be deemed better if the cost of capital is low. Would changes in the cost of capital ever cause a change in the IRR ranking of two such projects? Why or why not?

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