Calculate Project L internal rate of return

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Reference no: EM132039056

1. If you are long an at the money calendar spread your position would be measured at which of the following greeks? M a. Long vega, short gamma, positive theta M b. Short vega, short gamma, positive theta M c. Long vega, long gamma, positive theta M d. Long vega, short gamma, negative theta.

2. Project L has an initial cost of $78,437, and its expected net cash inflows are $13,750 per year for 10 years. The firm has a WACC of 7 percent, and Project L’s risk would be similar to that of the firm’s existing assets. Calculate Project L’s internal rate of return (IRR). Selected Answer: Correctb. 11.77% Answers: a. 9.41% Correctb. 11.77% c. 75.30% d. 7.00% e. 5.77%

Reference no: EM132039056

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