Penny-wenny

Agree with Bill. That was the question..the WACC decreased to 12 however the IRR was still below and thus the NPV was negative.

dcfox83

Are we discussing about the question from the test? Here we go:

If IRR < WACC => NPV must be negative because NPV = 0 if WACC = IRR.

dontknow1987

Guys do we have to complicate it so much, if we are talking about NPV, to me is pretty clear: wacc decreases ----> NPV increases; the same logic as bond and yields, you discount by a lesser amount ; that's it, full stop. I don;t know why IRR should enter the picture here....correct me if I am wrong...

amqata

dont know how the question was worded.. sure remember that it was quite a trap..