Refer to Olde West Products in E12- 27A. Compute the IRR of each project and use this information to identify the better investment.
In E12- 27A
• Project A costs $ 290,000 and offers seven annual net cash inflows of $ 63,000. Olde West Products requires an annual return of 14% on projects like A.
• Project B costs $ 395,000 and offers ten annual net cash inflows of $ 71,000. Olde West Products demands an annual return of 10% on investments of this nature.