Question: Please show all work. Thank you! 1. (20 points) Consider the following two projects with cash flows in $ : Assume that projects Alpha and

Please show all work. Thank you!

Please show all work. Thank you! 1. (20 points) Consider the following

1. (20 points) Consider the following two projects with cash flows in $ : Assume that projects Alpha and Beta are mutually exclusive. Both projects have a payback of 3.2 years. a) What are the missing cash flows in Year 4 for each project? (2+2=4 points ) b) What is the NPV for each project? What is the correct investment decision based on NPV rule? (3+3+2=8 points ) c) What is the IRR for each project? Can we use IRR rule to make the correct investmen decision? If yes, what is the correct investment decision based on IRR rule? If not, explai why. (3+3+2=8 points )

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