Purple Whale Foodstuffs Inc. is evaluating a proposed capital budgeting project (project Sigma) that will...
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Purple Whale Foodstuffs Inc. is evaluating a proposed capital budgeting project project Sigma that will require an initial investment of $
Purple Whale Foodstuffs Inc. has been basing capital budgeting decisions on a project's NPV; however, its new CFO wants to start using the IRR method for capital budgeting decisions. The CFO says that the IRR is a better method because returns in percentage form are easier to understand and compare to required returns. Purple Whale Foodstuffs Inc.s WACC is and project Sigma has the same risk as the firm's average project.
The project is expected to generate the following net cash flows:
tableYearCash FlowYear $
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