Question: assume the discount rate is 1 0 % . there are two projects A and B . project A is a one year project with

assume the discount rate is 10%. there are two projects A and B. project A is a one year project with an investment cost of 1000 and a cash flow of 1400 in year one. project b is an infinitely lived project with an investment cost of 2000 and an annual cash flow of 250. a. what are the net present values of the two projects? b. what is the internal rate of return of the two projects? c. if you could pick only one project (the projects are mutally exclusive) which one would you choose?

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