Kit question on Investment appraisal.

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April 5, 2016 at 9:16 am #309051
hisham503
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It might seem silly but i didnt follow the logic of IRR in KIT(BBP) question “slow fashions part a”.
I mean how is he using the irr, the decision rule in selection of the projects in IRR if i am not wrong is that is that IRR must be higher than cost of capital, but in the question combine IRR of all projects is calculated, which is confusing me.
April 5, 2016 at 7:17 pm #309102
John Moffat
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It is because the question asks for the IRR of the plan (not for an individual investment), and the plan involves investing in several investments.
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