标题: For a mutually exclusive project..which one did you guys pick [打印本页] 作者: lxwarr30 时间: 2011-7-11 20:09 标题: For a mutually exclusive project..which one did you guys pick
i dont remember the question exactly, but i chose IRR作者: MonkeyBusiness 时间: 2011-7-11 20:09
I am very sure that if there is clash between choices for mutualy exclusive projects, NPV should be chosed. And if i remember correctly, the CF0 was same for alll projects which means that no doubt is left regarding NPV as the only choice.作者: Maddin 时间: 2011-7-11 20:09
I lied I did put NPV....that is the better indicator作者: ramdabom 时间: 2011-7-11 20:09
NPV of course, you've never taken corporate if you don't know that作者: koba 时间: 2011-7-11 20:09
If it's independent = choose both projects as long as NPV >0 and IRR > discount rate (usually WACC)
If it's mutual = choose the project with the highest IRR and NPV so long as IRR > WACC and NPV > 0, but if the rank conflicting, use NPV instead because it calculates the net increase in the company value.作者: joemoran 时间: 2011-7-11 20:09
It was a bit of a trick I think, but yes, NPV is the correct measurement tool.
