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Should the Following Project Be Accepted If the Cost of Capital

Question 94

Multiple Choice

Should the following project be accepted if the cost of capital is 12%?
Initial Investment is $50,000
 Years  Cash Flars 1$25,0002$35,0003$55,000\begin{array} { | c | c | } \hline \text { Years } & \text { Cash Flars } \\\hline 1 & \$ 25,000 \\\hline 2 & \$ 35,000 \\\hline 3 & \$ 55,000 \\\hline\end{array}


A) Yes, because the internal rate of return is 10.5% which is less than 12%.
B) Yes, because the internal rate of return is 35% which is more than 12%.
C) No, because the internal rate of return is 8.7% which is less than 12%.
D) Yes, because the internal rate of return is 48% which is more than 12%.

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