XYZ Corporation is considering two mutually exclusive investment projects, Project A and Project B The following information is available for each project Project A Initial Investment $150,000 Annual Cash Inflows $50,000 for 5 years Project B Initial Investment $200,000 Annual Cash Inflows $60,000 for 4 years The company's cost of capital is 10 a) Calculate the Net Present Value (NPV) for each project using the given cost of capital b) Determine the Internal Rate of Return (IRR) for each project c) Based on your analysis, recommend which project XYZ Corporation should undertake, providing reasons for your recommendation

Question: XYZ Corporation is considering two mutually exclusive investment projects, Project A and Project B. The following information is available for each project: Project A: Initial

XYZ Corporation is considering two mutually exclusive investment projects, Project A and Project B. The following information is available for each project:

Project A:

Initial Investment: $150,000
Annual Cash Inflows: $50,000 for 5 years

Project B:

Initial Investment: $200,000
Annual Cash Inflows: $60,000 for 4 years

The company's cost of capital is 10%.

a) Calculate the Net Present Value (NPV) for each project using the given cost of capital. b) Determine the Internal Rate of Return (IRR) for each project. c) Based on your analysis, recommend which project XYZ Corporation should undertake, providing reasons for your recommendation.

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