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wilcoxj49 wilcoxj49
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2 months ago
Suppose a company has the following information on six independent projects:

ProjectCF0Annual CFkProject Life
Alpha$3 million$1.0 million20%5 years
Beta$8 million$3.0 million15%4 years
Charlie$7 million$2.8 million10%3 years
Delta$5 million$1.6 million8%4 years
Echo$4 million$1.8 million14%3 years
Foxtrot$6 million$1.5 million7%5 years
a)
Find the IRRs of the six projects.
b)Which projects should the company undertake if it has no capital constraints? Why?
c)What is the impact on the company's shareholder value in (b)?
d)Which projects should the company undertake if it has a capital constraint
of $15 million? Why?
e)What is the loss to the company from the capital rationing constraint in (d)?
Textbook 
Corporate Finance

Corporate Finance


Edition: 5th
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Gimor1220Gimor1220
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2 months ago
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wilcoxj49 Author
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2 months ago
Thanks
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This site is awesome
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2 hours ago
I appreciate what you did here, answered it right Smiling Face with Open Mouth
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