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Business, 12.04.2021 20:00 destmacklin

You are deciding between two mutually exclusive investment opportunities. both require the same initial investment of $ 10.1 million. investment a will generate $ 1.97 million per year​ (starting at the end of the first​ year) in perpetuity. investment b will generate $ 1.58 million at the end of the first​ year, and its revenues will grow at 2.9 % per year for every year after that. a. which investment has the higher​ irr?

b. which investment has the higher npv when the cost of capital is 5.2 %​?

c. in this​ case, for what values of the cost of capital does picking the higher irr give the correct answer as to which investment is the best​ opportunity?

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