Question: n. Caledonia is considering two additional mutually exclusive projects. The free cash flows associated with these projects are as follows: PROJECT A PROJECT B Initial

n. Caledonia is considering two additional
n. Caledonia is considering two additional mutually exclusive projects. The free cash flows associated with these projects are as follows: PROJECT A PROJECT B Initial outlay -$100,000 -$100,000 Inflow year 1 32,000 Inflow year 2 32,000 Inflow year 3 32,000 Inflow year 4 32,000 Inflow year 5 32,000 200,000 The required rate of return on these projects is 11 percent. 1. What is each project's payback period? 2. What is each project's NPV? 3. What is each project's IRR? 4. What has caused the ranking conflict? 5. Which project should be accepted? Why

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