Project a Has a Cost of $300 and a Three

question 125

Multiple Choice

Project A has a cost of $300 and a three year annual cash flow of $100, $200 and $300. Project B has a cost of $400 and a three year annual cash flow of $185, $215 and $315. Given this information, calculate the IRR cross-over rate.

• A) 6.77%
• B) 7.77%
• C) 8.77%
• D) 9.77%
• E) 10.77%

---

Definitions:

Null Hypothesis

A hypothesis that suggests there is no significant difference between specified populations, or no association among groups.

Null Hypothesis

A statistical hypothesis that assumes no effect or no difference in an experiment or study, serving as the default assumption to be tested.

Probability

Probability is the measure of the likelihood that an event will occur, expressed as a number between 0 and 1.

Statistic

A single measure, calculated from sample data, used to summarize a characteristic of the sample.