question archive Management of Crane Automotive, a manufacturer of auto parts, is considering investing in two projects
Management of Crane Automotive, a manufacturer of auto parts, is considering investing in two projects
Subject:FinancePrice: Bought3
Management of Crane Automotive, a manufacturer of auto parts, is considering investing in two projects. The company typically compares project returns to a cost of funds of 17.00 percent.
| Year | Project 1 | Project 2 | ||||
| 0 | - $455,506 | - $547,522 | ||||
| 1 | 277,000 | 121,750 | ||||
| 2 | 102,000 | 174,170 | ||||
| 3 | 122,500 | 266,700 | ||||
| 4 | 135,000 | 268,050 | ||||
Compute the IRRs based on the cash flows.
Which project(s) will be accepted? (Round final answer to 2 decimal places, e.g. 15.25%.)
| The IRR of project 1 is % and the project should be accepted/rejected. |
| The IRR of project 2 is % and the project should be rejected/accepted. |
