14.3
Consider the following two projects:
| Year 0 | Year 1 | Year 2 | Year 3 | |
| A | -40 | 20 | -10 | 40 |
| B | -100 | 60 | 0 | 70 |
The opportunity cost of capital for both projects is 10%.
3. Looking at the cashflows, can you tell whether there are
any problems with using IRR in this case? EXPLAIN. (2 pts.)
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