Problem: A company is analyzing two mutually exclusive projects, S and L, with the following cash flows:
0 1 2 3 4
| | | | |
S -$1,000 $900 $250 $10 $10
L -$1,000 $0 $250 $400 $800
The company's WACC is 10%. What is the IRR of the better project? I'm not sure that the better project may or may not be the one with the higher IRR.