Project X's IRR Is 19% and Project Y's IRR Is

question 16

Multiple Choice

Project X's IRR is 19% and Project Y's IRR is 17%.The projects have the same risk and the same lives,and each has constant cash flows during each year of their lives.If the WACC is 10%,Project Y has a higher NPV than X.Given this information,which of the following statements is correct?

• A)The crossover rate between the two projects must be less than 10%.
• B)The crossover rate between the two projects must be greater than 10%.
• C)If the WACC is 8%, Project X will have the higher NPV.
• D)If the WACC is 18%, Project Y will have the higher NPV.

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Definitions:

Work Stress

The adverse reaction people have to excessive pressures or types of demand placed on them at work.

Conscientious Employees

Workers who are diligent, careful, and thorough in their job responsibilities, often displaying a strong sense of duty and responsibility.

Work-family Tension

The stress or conflict arising from the competing demands of work and family responsibilities, affecting one’s ability to successfully fulfill roles in both areas.

Mobbing

A form of bullying in which an individual is repeatedly harassed, intimidated, or mistreated by a group in a workplace or other setting.