Question: Parkallen Inc. has identified the following two mutually exclusive projects: Year @ 1 2 3 4 Cash Flow (A) -$37,925 17,785 15,870 12,770 8,670 Cash

 Parkallen Inc. has identified the following two mutually exclusive projects: Year

@ 1 2 3 4 Cash Flow (A) -$37,925 17,785 15,870 12,770

Parkallen Inc. has identified the following two mutually exclusive projects: Year @ 1 2 3 4 Cash Flow (A) -$37,925 17,785 15,870 12,770 8,670 Cash Flow (B) -$37,925 7,780 13,200 18,69 28,888 0-1. What is the IRR for each of these projects? (Do not round intermediate calculations. Round the final answers to 2 decimal places.) Project A Project B IRR 1909 18.20 x a-2. Using the IRR decision rule, which project should the company accept? Project A Project B er 9 Assignment Stved Help Save & Exit Check UT Project B a-3. Is this decision necessarily correct? o Yes NO 3R b-1. If the required return is 11%, what is the NPV for each of these projects? (Do not round intermediate calculations. Round the final answers to 2 decimal places. Omit $ sign in your response.) Project A Project B NPV $ 5954.41 7079.82 b-2. Which project will the company choose fit applies the NPV dedsion rule? O Project A Project B c. At what discount rate would the company be indifferent between these two projects? (Do not round intermediate calculations. Round the final answer to 2 decimal places.) Discount rate %

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!