A Company Is Considering Two Mutually Exclusive Projects,A and B)Project

question 91

Multiple Choice

A company is considering two mutually exclusive projects,A and B) Project A requires an initial investment of $100, followed by cash flows of $95, $20, and $5.Project B requires an initial investment of $100, followed by cash flows of $0, $20, and $130.What is the IRR of the project that is best for the company's shareholders? The firm's cost of capital is 10 percent.

• A)15.24 percent
• B)15.96 percent
• C)15.42 percent