Explain the conflicting rankings of the npvs

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Reference no: EM131341288

Project Analysis:-

Assume that you are evaluating the following three mutually exclusive projects:

	A	B	C
Cost	$3,400	$3,400	$3,400
Year 1	0	1,870	1,020
Year 2	0	1,870	1,700
Year 3	6,460	1,870	3,284

A. Complete the following analyses. (For the last two lines, Terminal Value, please write in the dollar amount of the terminal value.)

237_Table 06.jpg

B. Compare and explain the conflicting rankings of the NPVs and TRRs versus the IRRs.

C. Using different discount rates, is it possible to get different rankings within the NPV calculation? Why or why not?

D. If 10 percent is the required return, which project is preferred?

E. Which is the fairer representation of these two projects, TRR or IRR? Why?

Reference no: EM131341288

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