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Bellinger Industries is considering two projects for inclusion in its capital budget, and you have been...

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Finance

Bellinger Industries is considering two projects for inclusionin its capital budget, and you have been asked to do the analysis.Both projects' after-tax cash flows are shown on the time linebelow. Depreciation, salvage values, net operating working capitalrequirements, and tax effects are all included in these cash flows.Both projects have 4-year lives, and they have risk characteristicssimilar to the firm's average project. Bellinger's WACC is 9%.

01234
Project A-1,050600360230300
Project B-1,050300280350750

What is Project Delta's IRR? Round your answer to two decimalplaces.

  %

Answer & Explanation Solved by verified expert
3.7 Ratings (592 Votes)
Project A Internal rate of return is calculated using a financial calculator by inputting the below Press the CF button CF0 1050 It is entered with a negative sign since it is a cash outflow Cash flow    See Answer
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Transcribed Image Text

Bellinger Industries is considering two projects for inclusionin its capital budget, and you have been asked to do the analysis.Both projects' after-tax cash flows are shown on the time linebelow. Depreciation, salvage values, net operating working capitalrequirements, and tax effects are all included in these cash flows.Both projects have 4-year lives, and they have risk characteristicssimilar to the firm's average project. Bellinger's WACC is 9%.01234Project A-1,050600360230300Project B-1,050300280350750What is Project Delta's IRR? Round your answer to two decimalplaces.  %

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