Question: Consider projects A and B: Cash Flows (dollars) Project C 0 C 1 C 2 NPV at 12% A 31,000 21,800 21,800 + $5,843 B

Consider projects A and B:

Cash Flows (dollars)
Project C0 C1 C2 NPV at 12%
A 31,000 21,800 21,800 + $5,843
B 51,000 34,000 34,000 + 6,462

a.

Calculate IRRs for A and B. (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.)

Project IRR
A %
B %

b. Which project does the IRR rule suggest is best?
Project A
Project B

c. Which project is really best?
Project A
Project B

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