Project a Has an Initial Cost of $22,400 and Cash

question 61

Multiple Choice

Project A has an initial cost of $22,400 and cash flows of $7,100,$8,800,and $1,900 for Years 1 to 3,respectively.Project B has an initial cost of $37,200 and cash flows of $18,300,$17,900,and $2,700 for Years 1 to 3,respectively.What is the incremental IRR?

• A)15.67%
• B)13.54%
• C)15.91%
• D)23.38%
• E)27.31%

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Definitions:

Interest Groups

Organizations that attempt to influence public policy and government decisions in favor of their members' or supporters' interests.

Monarch

A sovereign head of state, especially a king, queen, or emperor, who typically inherits the position by birth.

Republic

A form of government in which power is held by the people and their elected representatives, and which has an elected or nominated president rather than a monarch.

Referendum

A direct vote by the electorate on a specific question, proposal, or issue, often used to make decisions on legislative amendments or policy changes.