Sexton Inc $\text { WACC: } \quad 9.50 \%$ A) $18891
B) $145

question 4

Multiple Choice

Sexton Inc.is considering Projects S and L,whose cash flows are shown below.These projects are mutually exclusive,equally risky,and not repeatable.If the decision is made by choosing the project with the higher IRR,how much value will be forgone? Note that under certain conditions choosing projects on the basis of the IRR will not cause any value to be lost because the one with the higher IRR will also have the higher NPV,so no value will be lost if the IRR method is used. $\text { WACC: } \quad 9.50 \%$
$\begin{array}{llrrrr}&0&1&2&3&4\\\hline\mathrm{CF}_{\mathrm{S}} & -\$ 2,050 & \$ 750 & \$ 760 & \$ 770 & \$ 780 \\\mathrm{CF}_{\mathrm{L}} & -\$ 4,300 & \$ 1,500 & \$ 1,518 & \$ 1,536 & \$ 1,554\end{array}$

• A) $188.91
• B) $145.46
• C) $228.58
• D) $226.70
• E) $230.47

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Definitions:

Positive Transference

In psychotherapy, it describes the phenomenon where a patient projects favorable emotions towards the therapist, often mirroring feelings associated with other relationships.

Unconditional Positive Regard

Unqualified caring and nonjudgmental acceptance of another.

Free Association

A method in psychoanalysis where the patient speaks freely to reveal unconscious thoughts and feelings.

Resistance

The refusal to accept or comply with something; the attempt to prevent something by action or argument.