H B D E F G H 15 PROBLEM 2 16 Better Health, Inc. is evaluating two investment projects, each of which requires an up-front expenditure 17 of $1.5 million. The projects are expected to produce the following net cash inflows: 18 19 Year Project A Project B 20 0 $2,500,000 - $2,500,000 21 1 $600,000 $3,000,000 22 2 $1,000,000 $1,200,000 23 3 $3,000,000 $800,000 24 25 a. What is each project's IRR? 26 27 Project A: 28 Project B: 29 30 31 b. What is each project's NPV if the cost of capital is 7 percent? 15 percent? 20 percent? 32 33 34