Question: XYZ is considering two mutually exclusive projects called A and B. The initial cost of project A is $100000 and it generates the after tax
XYZ is considering two mutually exclusive projects called A and B. The initial cost of project A is $100000 and it generates the after tax cash flow of 15000 per year forever. The initial cost of project A is $150000 and it generates the after tax cash flow of 18000 per year forever. What is the cross over rate for project A and B if the discount rate is 10%?
| 9% | ||
| 6% | ||
| 10% | ||
| 5% |
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