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Evaluate the Following Mutually Exclusive Projects Using IRR as a Selection

Question 110

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Evaluate the following mutually exclusive projects using IRR as a selection criterion. Assuming a discount rate of 14%, which project-if either-would be selected? Project A costs $50,000 and returns $15,000 after-tax annually. Project B costs $35,000 and returns $11,000 after-tax annually. Both projects have a 5-year life.

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