Projects have the same risk and the same lives

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Reference no: EM131311584

Project X’s IRR is 19% and Project Y’s IRR is 17%. The projects have the same risk and the same lives, and each has constant cash flows during each year of their lives. If the WACC is 10%, Project Y has a higher NPV than X. Given this information, which of the following statements is correct?

The crossover rate between the two projects must be greater than 10%.

The crossover rate between the two projects must be less than 10%.

If the WACC is 8%, Project X will have the higher NPV.

If the WACC is 18%, Project Y will have the higher NPV.

Reference no: EM131311584

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