Part C

Piercy, LLC, has identified the following two mutually exclusive projects: Year 1 2 3 4. Cash Flow (A) Cash Flow (B) $ 77,500 -$ 77,500 43,000 21,500 29.000 28,000 32,000 45,000 21,000 41,000 a-1. What is the IRR for each of these projects? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) a-2. If you apply the IRR decision rule, which project should the company accept? b-1. Assume the required return is 11 percent. What is the NPV for each of these projects? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g. 32.16.) b-2. Which project will you choose if you apply the NPV decision rule? a-1. Project A Project B a-2. Project acceptance b-1. Project A 25.36% 23.36% Project A 22.007.26 c-1. Over what range of discount rates would you choose Project A? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) c-2. Over what range of discount rates would you choose Project B? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) c-3. At what discount rate would you be indifferent between these two projects? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) an interest rate of % Project A Project B Indifferent interest rate an interest rate of % %