Which projects would you accept in spending

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Reference no: EM131999189

The Suboptimal Glass Company uses a process of capital rationing in its decision making. The firm's cost of capital is 10 percent. It will only invest $61,800 this year. It has determined the internal rate of return for each of the following projects.

Project	Project size		Internal rate of return
A	$	11,700		13%
B		31,700		12
C		21,700		15
D		11,700		20
E		11,700		22
F		21,700		21
G		16,700		18

(a) Pick out the projects that the firm should accept. (You may select more than one answer. Click the box with a check mark for the correct answer and click to empty the box for the wrong answer.)

Project C
Project A
Project D
Project F
Project E
Project B
Project G

(b) If Projects E and F are mutually exclusive, which projects would you accept in spending $61,800? (You may select more than one answer. Click the box with a check mark for the correct answer and click to empty the box for the wrong answer.)

Project C
Project A
Project D
Project B
Project E
Project F
Project G

Reference no: EM131999189

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