# Question: you are deciding between two mutually exclusive investment opportunities both...

###### Question details

You are deciding between two mutually exclusive investment
opportunities. Both require the same initial investment of

$10 million. Investment A will generate $2.2 million per year
(starting at the end of the first year) in perpetuity. Investment B
will generate $1.8 million at the end of the first year, and its
revenues will grow at 3.9% per year for every year after that. Use
the incremental IRR rule to correctly choose between investments A
and B when the cost of capital is 6.7%.

The incremental IRR is %. (Round to two decimal places.)

You should take Investment A or Investment B