Multiple Choice
Benji's has an opportunity with an initial cash flow of $48,900 and future cash flows of -$31,300 in Year 1 and -$21,600 in Year 2.The discount rate is 7 percent.Should this project be accepted or rejected? Why?
A) Accepted;because the IRR of 5.28 percent is less than the discount rate
B) Accepted;because the IRR of 5.77 percent is less than the discount rate
C) Rejected: because the IRR of 5.28 percent is less than the discount rate
D) Rejected;because the IRR of 5.77 percent is less than the discount rate
E) Rejected;because the IRR of 6.01 percent is less than the discount rate
Correct Answer:
Verified
Correct Answer:
Verified
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