Question: Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 $ 360,000 $ 45,000 1 35,000 23,000 2 55,000 21,000

Consider the following two mutually exclusive projects:

Year Cash Flow (A) Cash Flow (B)
0 $ 360,000 $ 45,000
1 35,000 23,000
2 55,000 21,000
3 55,000 18,500
4 430,000 13,600

Whichever project you choose, if any, you require a 14 percent return on your investment.

d-1

What is the IRR for each project?

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