Question: Computer the (a) net present value, (b) internal rate of return (IRR), and (c) discounted payback period (DPB) for each of the following projects. The
Computer the (a) net present value, (b) internal rate of return (IRR), and (c) discounted payback period (DPB) for each of the following projects. The firm's required rate of return is 14 percent.
| Year | Project A | Project B |
| 0 | $(260,000) | $(290,000) |
| 1 | 120,000 | 0 |
| 2 | 120,000 | (80,000) |
| 3 | 120,000 | 555,000 |
Which project(s) should be purchased if they are independent? Which project(s) should be purchased if they are mutally exclusive?
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