Question: Bruin, Inc., has identified the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 $36,600 $36,600 1 18,930 6,490 2 14,430

Bruin, Inc., has identified the following two mutually exclusive projects:

Year Cash Flow (A) Cash Flow (B)
0 $36,600 $36,600
1 18,930 6,490
2 14,430 12,990
3 11,930 19,490
4 8,930 23,490

a. What is the IRR for Project A?

b. What is the IRR for Project B?

c. If the required return is 14 percent, what is the NPV for Project A?

d. If the required return is 14 percent, what is the NPV for Project B?

e. At what discount rate would the company be indifferent between these two projects?

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