If the firm uses a discount rate of 10%, which of the following projects would increase the firm's value assuming the projects are not mutually exclusive?
$$\begin{array} { | l | l | l | l | l | }
\hline \text { Project } & \text { A } & \text { B } & \text { C } & \text { D } \
\hline \text { IRR } & 5 \% & 14 \% & 7 \% & 11 \% \
\hline
\end{array}$$

Question

If the firm uses a discount rate of 10%, which of the following projects would increase the firm's value assuming the projects are not mutually exclusive?
$$\begin{array} { | l | l | l | l | l | } 
\hline \text { Project } & \text { A } & \text { B } & \text { C } & \text { D } \
\hline \text { IRR } & 5 \% & 14 \% & 7 \% & 11 \% \
\hline
\end{array}$$

Quizplus · Accepted Answer

Projects with an Internal Rate of Return (IRR) greater than the firm's discount rate (10%) increase the firm's value. Thus, projects B and D, with IRRs of 14% and 11% respectively, meet this criterion.

If the Firm Uses a Discount Rate of 10%, Which