Question: Brian Cliff is evaluating two mutually exclusive projects (expected cash flows shown below). The firm's cost of capital is 14 percent. Year Project A Project
Brian Cliff is evaluating two mutually exclusive projects (expected cash flows shown below). The firm's cost of capital is 14 percent. Year Project A Project B 0 (600) (600) 1 200 400 2 310 260 3 400 100 NPV? IRR? Calculate the NPVs and IRRs for Projects A and B. O Project A's NPV is $87.18, and Project B's NPV is $18.44 O Project A's NPV is greater than Project B's NPV by 65.52. Project A's NPV is greater than Project B's NPV by 66.25. O Project A's IRR is 21.27 percent, and Project B's IRR is 18.70 percent
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