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thatguy67 thatguy67
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A month ago
Suppose project Acquisition and project Merger are mutually exclusive. Project Acquisition requires an initial cash outlay of $50,000 and is expected to provide after-tax cash flows of $15,000 in year 1, $25,000 in year 2, $20,000 in year 3, and $15,000 in year 4. Project Merger requires an initial cash outlay of $75,000 and is expected to provide after-tax cash flows of $20,000 in year 1, $28,000 in year 2, $35,000 in year 3, and $20,000 in year 4. The appropriate discount rate is 12%. What is the crossover rate?

▸ 4.30%

▸ 13.72%

▸ 18.59%

▸ 4.87%
Textbook 
Corporate Finance

Corporate Finance


Edition: 5th
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tulipfiascotulipfiasco
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A month ago
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thatguy67 Author
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Thank you, thank you, thank you!
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this is exactly what I needed
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