what discount rate would result in the same NPV for both projects?作者: Beatnik 时间: 2011-7-11 19:51
The discount rate is 6.73% however you have to arrive at it by process of elimination. I think this problem in the book gave you about 5% ranges to save time.作者: kmf229 时间: 2011-7-11 19:51
take the difference between the two cash flows, compute the irr. thats the rate at which the two npvs are equal.作者: Siddimaula 时间: 2011-7-11 19:51
that's handy, correction the npv is 6.73 not discount rate....the discount rate is 13.16 so the difference in cash flows does work. sorry for the confusion there
