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3 marksInvestment Appraisal

CAPE Management of Business Unit 1 · 2006 · Paper 1 · Question 13(b)

An analysis of Internal Rate of Return (IRR) for projects A, B, and C yielded 10%, 8%, and 9% respectively. A manager deduced that Project B is the most desirable based on its IRR.

State whether the manager's conclusion is correct and provide a reason based on the IRR values.

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  1. 13(a)A company with a financial year ending September 30 is contracted to pay rent of 840 per month, and paid 9 660 for the year ending September 30, 2005. State…[2 marks]

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