FM11 11 - MIRR S> MIRR L and PI S> PI L The scale...

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Project L Inputs 5 12 0 7400 I PV PMT FV N Output = -47,011.07 PV costs L = $25,000. FV inflows L = $47,011.07. Inputs 5 -25000 0 47011.07 I PV PMT FV N Output = 13.46 MIRR L = 13.46%. PI S = 000 , 10 $ 33 . 814 , 10 $ = 1.081. PI L = 000 , 25 $ 34 . 675 , 26 $ = 1.067. Thus, NPV L > NPV S , IRR S > IRR L
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Unformatted text preview: , MIRR S > MIRR L , and PI S > PI L . The scale difference between Projects S and L result in the IRR, MIRR, and PI favoring S over L. However, NPV favors Project L, and hence L should be chosen. Answers and Solutions: 11 - 11...
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This note was uploaded on 07/13/2011 for the course FIN 4414 taught by Professor Staff during the Spring '08 term at University of Florida.

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