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Levels Tought:
Elementary,Middle School,High School,College,University,PHD
| Teaching Since: | Apr 2017 |
| Last Sign in: | 419 Weeks Ago, 1 Day Ago |
| Questions Answered: | 3232 |
| Tutorials Posted: | 3232 |
MBA,MCS,M.phil
Devry University
Jan-2008 - Jan-2011
MBA,MCS,M.Phil
Devry University
Feb-2000 - Jan-2004
Regional Manager
Abercrombie & Fitch.
Mar-2005 - Nov-2010
Regional Manager
Abercrombie & Fitch.
Jan-2005 - Jan-2008
Murray Inc. is considering Projects S and L, whose cash flows are shown below. These projects are mutually exclusive, equally risky, and not repeatable. The CEO wants to use the IRR criterion, while the CFO favors the NPV method. You were hired to advise Murray on the best procedure. What are the projects IRRs, NPVs and what is the crossover rate? Which project should be accepted?
|
WACC: |
6.00% |
 |  |  |  |
|
Year |
0 |
1 |
2 |
3 |
4 |
|
CFS |
-$1,025 |
$380 |
$380 |
$380 |
$380 |
|
CFL |
-$2,150 |
$765 |
$765 |
$765 |
$765 |
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