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Sun Lee's Is Considering Two Mutually Exclusive Projects That Have

Question 16

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Sun Lee's is considering two mutually exclusive projects that have been assigned the same discount rate of 10.5 percent.Project A has an initial cost of $54,500,and should produce cash inflows of $16,400,$28,900,and $31,700 for Years 1 to 3,respectively.Project B has an initial cost of $79,400,and should produce cash inflows of $0,$48,300,and $42,100,for Years 1 to 3,respectively.What is the incremental IRR?


A) −15.40 percent
B) −11.23 percent
C) 4.08 percent
D) 7.83 percent
E) 13.89 percent

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