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Author Question: Which statement about a projects IRR is correct? Assume that all projects being considered have ... (Read 52 times)

abcdef9106

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Which statement about a project’s IRR is correct? Assume that all projects being considered have normal cash flows and are equally risky.

If a project’s IRR is equal to its WACC, then under all reasonable conditions the project’s NPV must be zero.


If a project’s IRR is equal to its WACC, then, under all reasonable conditions, the project’s IRR must be negative.


If a project’s IRR is equal to its WACC, then under all reasonable conditions the project’s NPV must be negative.


When evaluating mutually exclusive projects, those projects with relatively short lives will tend to have relatively low NPVs when the cost of capital is relatively low.



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Marked as best answer by abcdef9106 on Aug 7, 2023

3ginamay

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abcdef9106

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Reply 2 on: Aug 7, 2023
YES! Correct, THANKS for helping me on my review


irishcancer18

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Reply 3 on: Yesterday
Excellent

 

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