c-1. Compute the NPV for both projects. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)

	NPV
Deepwater Fishing	$
Submarine Ride	$

c-2. Based on the NPV, which project should you choose?

Submarine

Deepwater

Is the NPV rule consistent with the incremental IRR rule?

• Yes

• No

Consider the following cash flows on two mutually exclusive projects for the Bahamas Recreation Corporation. Both projects require an annual return of 18 percent. Deepwater New Submarine Year Fishing Ride 0 -$1,040,000 $2,030,000 460,000 1,080,000 582,000 890,000 510,000 930,000 a-1. Compute the IRR for both projects. (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) Deepwater Fishing Submarine Ride a-2. Based on the IRR, which project should you choose? Deepwater Fishing Submarine Ride b-1. Calculate the incremental IRR for the cash flows. (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Incremental IRR % b-2. Based on the incremental IRR, which project should you choose? Submarine Ride Deepwater Fishing