Question: You have to pick between three mutually exclusive projects with the following cash flows to the firm: Year Project A Project B Project C 0

You have to pick between three mutually exclusive projects with the following cash flows to the firm: Year Project A Project B Project C 0 $ 1 0 , 0 0 0 $ 5 , 0 0 0 $ 1 5 , 0 0 0 1 $ 8 , 0 0 0 $ 5 , 0 0 0 $ 1 0 , 0 0 0 2 $ 7 , 0 0 0 $ 8 , 0 0 0 $ 1 0 , 0 0 0 The cost of capital is 1 2 % . a . Which project would you pick using the NPV rule? b . Which project would you pick using the IRR rule? c . How would you explain the differences between the two rules? Which one would you rely on to make your choice

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