The IRR of Normal Project X Is Greater Than the IRR

question 159

True/False

The IRR of normal Project X is greater than the IRR of normal Project Y,and both IRRs are greater than zero.Also,the NPV of X is greater than the NPV of Y at the required rate of return.If the two projects are mutually exclusive,Project X should definitely be selected,and the investment made,provided we have confidence in the data.Put another way,it is impossible to draw NPV profiles that would suggest not accepting Project X.

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Definitions:

Functional Levels

Different layers within an organization, each responsible for specific, specialized areas of work or operations.

Quantity Demanded

The total amount of a good that consumers are willing and able to purchase at a given price over a specified period of time.

Quantity Supplied

The total amount of a good or service that producers are willing and able to sell at a given price.

Equilibrium Price

The price level at which the market's offered goods and demanded goods are in balance.