Question: Consider projects A and B: Cash Flows (dollars) Project C0 C1 C2 NPV at 11% A 32,000 22,600 22,600 +$6,703 B 52,000 35,000 35,000 +7,938

Consider projects A and B:

Cash Flows (dollars)

Project C0 C1 C2 NPV at 11%

A 32,000 22,600 22,600 +$6,703

B 52,000 35,000 35,000 +7,938

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

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

c. Which project is really best?

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