You are on the staff of Camden Inc.The CFO believes project acceptance should be

ID: 2369159 • Letter: Y

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You are on the staff of Camden Inc.The CFO believes project acceptance should be based on the NPV, but Steve Camden, the president, insists that no project can be accepted unless its IRR exceeds the project

You are on the staff of Camden Inc.The CFO believes project acceptance should be based on the NPV, but Steve Camden, the president, insists that no project can be accepted unless its IRR exceeds the project

You are on the staff of Camden Inc.The CFO believes project acceptance should be based on the NPV, but Steve Camden, the president, insists that no project can be accepted unless its IRR exceeds the project You are on the staff of Camden Inc.The CFO believes project acceptance should be based on the NPV, but Steve Camden, the president, insists that no project can be accepted unless its IRR exceeds the project

Explanation / Answer

At 10%, the NPV is $2,355.37, but you find two IRRs, one at 6.33% and one at 527%, and a MIRR of 11.32%. The project should be accepted, because its MIRR > WACC and NPV > 0.

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You are on the staff of Camden Inc.The CFO believes project acceptance should be

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