Question: Consider two mutually exclusive projects A and B: Cash Flows (dollars) Project C 0 C 1 C 2 NPV at 10%A39,00028,20028,200+$9,942B59,00042,00042,000+13,893 a. Calculate IRRs for

Consider two mutually exclusive projects A and B:

Cash Flows (dollars)

ProjectC0C1C2NPV at 10%A39,00028,20028,200+$9,942B59,00042,00042,000+13,893

a.Calculate IRRs for A and B.

Which project does the IRR rule suggest is best?

  • Project A
  • Project B

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