Galaxy Satellite Co. is attempting to select the best group of independent projects competing for the firm’s fixed capital budget of $10,000,000. Any unused portion of this budget will earn less than its 20 percent cost of capital. A summary of key data about the proposed projects follows.
Project PV of Inflows Initial Investment IRR
A $3,050,000 $3,000,000 21%
B $9,320,000 $9,000,000 25%
C $1,060,000 $1,000,000 24%
D $7,350,000 $7,000,000 23%
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